The Companies (Northern Ireland) Order 1986 (revoked) No. 1032 (NI. 6)

F1029 Order repealed (prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16 and the repeal being partly in force, as to which see individual Articles (with savings (with adaptations) by Companies Act 2006 (Commencement No. 6, Saving and Commencement Nos. 3 and 5 (Amendment)) Order 2008 (S.I. 2008/674), arts. 2(3), {4}, Sch. 2) and subject to amendments (6.4.2008) by Companies Act 2006 (Consequential Amendments etc) Order 2008 (S.I. 2008/948), arts. 2(2), 3(1)(b)(2), Sch. 1 paras. 135, 147, 148 {Sch. 2 Note 1} (with arts. 6, 11, 12) and subject to amendments (6.4.2008) by S.R. 2008/133, {regs. 2, 3}

PART IF1029 N.I. INTRODUCTORY AND INTERPRETATION

Title and commencement N.I.

1.—(1) This Order may be cited as the Companies (Northern Ireland) Order 1986.

(2) F1 . . . this Order comes into operation on the expiration of three months from the day on which it is made.

F1 1990 NI 5

General interpretation N.I.

2.—(1) The [1954 c.33 (N.I.)] Interpretation Act (Northern Ireland) 1954 applies to Article 1 and the following provisions of this Order as it applies to a Measure of the Northern Ireland Assembly.

Para. (2) rep. by 1990 NI 10

(3 )F2  In this Order—

• “the Act of 1960” means the [1960 c.22 (N.I.)] Companies Act (Northern Ireland) 1960;

• “agent” does not include a person's counsel acting as such;

• “annual return” means the return to be made by a company under Article 371 or 372 (as the case may be);

• “articles” and “articles of association” mean, in relation to a company, its articles of association, as originally framed or as altered by resolution, including (so far as applicable to the company) regulations contained in or annexed to any statutory provision relating to companies passed or made before this Order, as altered by or under any such statutory provision;

• Definition rep. by 1990 NI 5

• “authorised minimum” has the meaning given by Article 128;

• “bank holiday” means a day which is a bank holiday in Northern Ireland under the [1971 c.80] Banking and Financial Dealings Act 1971;

• Definition rep. by SI 2001/3649

• “books and papers” and “books or papers” include accounts, deeds, writings and documents;

• [F3 “communication” means the same as in the Electronic Communications Act (Northern Ireland) 2001;]

• “the Companies Orders” means this Order, the[F4 insider dealing legislation] and the consequential Provisions Order;

• “company limited by guarantee” and “company limited by shares” have the meaning assigned to them respectively by Article 12(2);

• “the Consequential Provisions Order” means the [1986 NI 9] Companies Consolidation (Consequential Provisions) (Northern Ireland) Order 1986;

• “contributory” has the meaning assigned to it by Article 473;

• “the court,” in relation to a company, means the court having jurisdiction to wind up the company;

• “debenture” includes debenture stock, bonds and any other securities of a company, whether constituting a charge on the assets of the company or not;

• “the Department” means the Department of Economic Development;

• “document” includes summons, notice, order and other legal process, and registers;

• F5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F3 “electronic communication” means the same as in the Electronic Communications Act (Northern Ireland) 2001;]

• “equity share capital” means, in relation to a company, its issued share capital excluding any part of that capital which, neither as respects dividends nor as respects capital, carries any right to participate beyond a specified amount in distribution;

• “expert” has the meaning given by Article 72;

• “former Companies Acts” means the [1862 c.89] Joint Stock Companies Acts, the [1908 c.69] Companies Act 1862, the Companies (Consolidation) Act 1908, the [1932 c.7 (N.I.)] Companies Act (Northern Ireland) 1932 and the Companies Acts (Northern Ireland) 1960 to 1983;

• “hire purchase agreement” has the same meaning as in the [1974 c.39] Consumer Credit Act 1974;

• [F4 “the insider dealing legislation” means Part V of the Criminal Justice Act 1993 (insider dealing);]

• [F6 “insurance market activity” has the meaning given in section 316(3) of the Financial Services and Markets Act 2000;]

• “the Insolvency Account” means the account kept by the Department under[F7 Article 358 of the Insolvency Order];

• Definition rep. by SI 2001/3649

• “joint stock company” has the meaning given by Article 632;

• “the Joint Stock Companies Acts” means the [1856 c.47] Joint Stock Companies Act 1856, the [20 & 21 VICT. c.14] Joint Stock Banking Companies Act 1856, 1857, the [1857 c.49] Joint Stock Banking Companies Act 1857 and the Act to enable Joint Stock Banking Companies to be formed on the principle [1858 c.91] of limited liability, or any one or more of those Acts (as the case may require), but does not include the [1844 c. 110] Joint Stock Companies Act 1844;

• “memorandum”, in relation to a company, means its memorandum of association, as originally framed or as altered in pursuance of any statutory provision;

• “number”, in relation to shares, includes amount, where the context admits of the reference to shares being construed to include stock;

• “officer” in relation to a body corporate, includes a director or secretary;

• “the Official Assignee” means the officer appointed under Article 488 and, for the purposes of this Order, includes an Assistant Official Assignee;

• “the Order of 1978” means the [1978 NI 12] Companies (Northern Ireland) Order 1978;

• “the Order of 1981” means the [1981 NI 19] Companies (Northern Ireland) Order 1981;

• “the Order of 1982” means the [1982 NI 17] Companies (Northern Ireland) Order 1982;

• “the Order of 1983” means the [1983 NI 12] Companies (Beneficial Interests) (Northern Ireland) Order 1983;

• “Part XXIII company” has the meaning given by Article 640;

• “place of business” includes a share transfer or share registration office;

• “prescribed” meansF7 . . . , prescribed by regulations made under Article 681;

• “prospectus” means any prospectus, notice, circular, advertisement or other invitation, offering to the public for subscription or purchase any shares in or debentures of a company;

• [F8 “prospectus issued generally” means a prospectus issued to persons who are not existing members of the company or holders of its debentures;]

• Definition rep. by 1987 c. 22

• Definition rep. by 1986 c. 60

• [F6 regulated activity has the meaning given in section 22 of the Financial Services and Markets Act 2000;]

• “the registrar” means the registrar of companies appointed under Article 653, and, for the purposes of this Order, includes an assistant registrar;

• “a resolution for reducing share capital” has the meaning assigned to it by Article 145(3);

• Definition rep. by 1989 NI 19

• “share” means share in the share capital of a company and includes stock (except where a distinction between shares and stock is express or implied);

• “statutory provision” has the meaning assigned to it by section 1(f) of the [1954 c.33 (N.I.)] Interpretation Act (Northern Ireland) 1954;

• “undischarged bankrupt” includes—

  (a)

  a bankrupt who has not obtained the certificate of conformity mentioned in section 56 of the [1872 c.58] Bankruptcy (Ireland) Amendment Act 1872;

  (b)

  a bankrupt who has not been discharged from his bankruptcy by an absolute order of discharge under Article 28 or 30 of the [1980 NI 4] Bankruptcy Amendment (Northern Ireland) Order 1980 [F7 or Article 254 of the Insolvency Order], or by virtue of the expiration of the period or the satisfaction of any requirement specified in a suspended or conditional order of discharge under[F7 any] of those Articles, or by virtue of Article 29(2) or (4) (automatic discharge) of that Order[F7 of 1980 or of Article 253 (duration of discharge) of the Insolvency Order];

  (c)

  a person who is an undischarged bankrupt under the law of England or Scotland;

• “undistributable reserves” has the meaning given by Article 272;

• “unlimited company” has the meaning assigned to it by Article 12(2)(c).

(4) For the purposes of section 42 of the [1973 c.36] Northern Ireland Constitution Act 1973 (validity of Acts of Parliament of Northern Ireland), provisions of this Order which re-enact provisions of an Act of the Parliament of Northern Ireland are deemed to be provisions of such an Act.

F2 mod. by SR 2004/307

F3 SR 2003/3

F4 1993 c.36

F5 Art. 2: definition of "EEA State" repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

F6 SI 2001/3649

F7 1989 NI 19

F8 Art 2: definition of "prospectus issued generally" repealed (29.4.1988 for certain purposes, otherwise prosp.) by Financial Services Act 1986 (c. 60), s. 212(3), Sch. 17 Pt. II; S.I. 1988/740, art. 2, Sch. (N.B. 1986 c. 60 repealed (1.12.2001) by S.I. 2001/3649, arts. 1, 3(1)(c) (with art. 292))

{prosp. insertion of 2nd art. 2A by 1990 NI10} N.I.

F9 Art. 2A (new) prosp. insertion by 1990 NI10

F10 SI 2001/3649 amending art. 2A which was inserted prosp. by 1990 NI 10

F11 SR 2003/3 amending art. 2A which was inserted prosp. by 1990 NI 10

F12 SR 2004/263 amending Art. 2A which was inserted prosp. by 1990 NI 10

F13 SR 2004/496 5 amendments to be made amending Art. 2A which was inserted prosp. by 1990 NI 10

F14 mod. by SR 2004/307

[F15 Relationship of this Order to Insolvency Order N.I.

2A.— (1 )F16  In this Order “the Insolvency Order” means the Insolvency (Northern Ireland) Order 1989.

(2) In Articles 383(1)(b), 418(5)(a),F17 . . . 453(2), 625, 626, 627 and 676 and paragraph 6(1) of Schedule 20 the words “this Order” are to be read as including Parts II to VII and Articles 359 to 362 of the Insolvency Order[F18 and the Company Directors Disqualification (Northern Ireland) Order 2002]

.

(3) In Articles[F19 653(4) and (5)], 655(1),[F20 656B],[F17 656A(1),] 657(1)(a) and (3),[F17 658(1) and (3),][F17 659A], 662(1), 677 and 680(3) references to the Companies Orders include Parts II to VII and Articles 359 to 362 of the Insolvency Order[F18 and the Company Directors Disqualification (Northern Ireland) Order 2002].]

F15 1989 NI 19

F16 mod. by SR 2004/307

F17 1990 NI 10

F18 2002 NI 4

F19 1996 NI 11

F20 SR 2003/3

[F21 Relationship of this Order to Parts IV and V of the Financial Services Act 1986 N.I.

2B.   In Articles[F22 653(4) and (5)], 655(1), 656(1), 656A(1), 657(1)(a) and (3), 658(1) and (3), 659A and 662(1) references to the Companies Orders include[F23 Part 6 of the Financial Services and Markets Act 2000].]

F21 1990 NI 10, art. 61(6)

F22 1996 NI 11

F23 SI 2001/3649

“Company”, etc. N.I.

3.—(1) In this Order—

(a) “company” means a company formed and registered under this Order, or an existing company;

(b) “existing company” means a company formed and registered, or deemed to have been registered, in Northern Ireland under the former Companies Acts;

(2) “Public company” and “private company” have the meanings given by Article 12.

[F24 “ Subsidiary ”, “ holding company ” and “ wholly-owned subsidiary ” N.I.

4.— (1 )F25  A company is a “subsidiary” of another company, its “holding company”, if that other company—

(a) holds a majority of the voting rights in it, or

(b) is a member of it and has the right to appoint or remove a majority of its board of directors, or

(c) is a member of it and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in it,

• or if it is a subsidiary of a company which is itself a subsidiary of that other company.

F25 (2 )F25  A company is a “wholly-owned subsidiary” of another company if it has no members except that other and that other's wholly-owned subsidiaries or persons acting on behalf of that other or its wholly-owned subsidiaries.

(3) In this Article “company” includes any body corporate.]

F24 1990 NI 10, art. 62(1)

F25 mod. by SR 2004/307

[F26 Provisions supplementing Article 4 N.I.

4A.— (1) The provisions of this Article explain expressions used in Article 4 and otherwise supplement that Article.

F27 (2) In Article 4(1)(a) and (c) the references to the voting rights in a company are to the rights conferred on shareholders in respect of their shares or, in the case of a company not having a share capital, on members, to vote at general meetings of the company on all, or substantially all, matters.

F27 (3) In Article 4(1)(b) the reference to the right to appoint or remove a majority of the board of directors is to the right to appoint or remove directors holding a majority of the voting rights at meetings of the board on all, or substantially all, matters; and for the purposes of that provision—

(a) a company shall be treated as having the right to appoint to a directorship if—

(i) a person's appointment to it follows necessarily from his appointment as director of the company, or

(ii) the directorship is held by the company itself; and

(b) a right to appoint or remove which is exercisable only with the consent or concurrence of another person shall be left out of account unless no other person has a right to appoint or, as the case may be, remove in relation to that directorship.

(4) Rights which are exercisable only in certain circumstances shall be taken into account only—

(a) when the circumstances have arisen, and for so long as they continue to obtain, or

(b) when the circumstances are within the control of the person having the rights;

and rights which are normally exercisable but are temporarily incapable of exercise shall continue to be taken into account.

(5) Rights held by a person in a fiduciary capacity shall be treated as not held by him.

(6) Rights held by a person as nominee for another shall be treated as held by the other; and rights shall be regarded as held as nominee for another if they are exercisable only on his instructions or with his consent or concurrence.

(7 )F27  Rights attached to shares held by way of security shall be treated as held by the person providing the security—

(a) where apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in accordance with his instructions;

(b) where the shares are held in connection with the granting of loans as part of normal business activities and apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in his interests.

(8 )F27  Rights shall be treated as held by a company if they are held by any of its subsidiaries; and nothing in paragraph (6) or (7) shall be construed as requiring rights held by a company to be treated as held by any of its subsidiaries.

(9 )F27  For the purposes of paragraph (7) rights shall be treated as being exercisable in accordance with the instructions or in the interests of a company if they are exercisable in accordance with the instructions of or, as the case may be, in the interests of—

(a) any subsidiary or holding company of that company, or

(b) any subsidiary of a holding company of that company.

(10 )F27  The voting rights in a company shall be reduced by any rights held by the company itself.

(11) References in any provision of paragraphs (5) to (10) to rights held by a person include rights falling to be treated as held by him by virtue of any other provision of those paragraphs but not rights which by virtue of any such provision are to be treated as not held by him.

(12 )F27  In this Article “company” includes any body corporate.]

F26 1990 NI 10, art. 62(2)

F27 mod. by SR 2004/307

[F28 Power to amend Articles 4 and 4A N.I.

4B.— (1) The Department may by regulations amend Articles 4 and 4A so as to alter the meaning of the expressions “holding company”, “subsidiary” or “wholly-owned subsidiary”.

(2) Any amendment made by regulations under this Article does not apply for the purposes of statutory provisions outside the Companies Orders unless the regulations so provide.

(3) So much of section 29(1) of the Interpretation Act (Northern Ireland) 1954 (effect of repeal and re-enactment) as relates to statutory documents shall not apply in relation to any repeal and re-enactment effected by regulations made under this Article.]

F28 1990 NI 10, art. 62(3)

“Called-up share capital” N.I.

5.—(1) In this Order, “called-up share capital”, in relation to a company, means so much of its share capital as equals the aggregate amount of the calls made on its shares (whether or not those calls have been paid), together with any share capital paid up without being called and any share capital to be paid on a specified future date under its articles, the terms of allotment of the relevant shares or any other arrangements for payment of those shares.

(2) “Uncalled share capital” is to be construed accordingly.

“Allotment” and “paid up” N.I.

6.—(1) In relation to an allotment of shares in a company, the shares are to be taken for the purposes of this Order to be allotted when a person acquires the unconditional right to be included in the company's register of members in respect of those shares.

(2) For the purposes of this Order, a share in a company is deemed paid up (as to its nominal value or any premium on it) in cash, or allotted for cash, if the consideration for the allotment or payment up is cash received by the company, or is a cheque received by it in good faith which the directors have no reason for suspecting will not be paid, or is a release of a liability of the company for a liquidated sum, or is an undertaking to pay cash to the company at a future date.

(3) In relation to the allotment or payment up of any shares in a company, references in this Order (except Articles 99 to 104) to consideration other than cash and to the payment up of shares and premiums on shares otherwise than in cash include the payment of, or any undertaking to pay, cash to any person other than the company.

(4) For the purpose of determining whether a share is or is to be allotted for cash, or paid up in cash, “cash” includes foreign currency.

“Non-cash asset” N.I.

7 .F29 —(1) In this Order “non-cash asset” means any property or interest in property other than cash; and for this purpose “cash” includes foreign currency.

(2) A reference to the transfer or acquisition of a non-cash asset includes the creation or extinction of an estate or interest in, or a right over, any property and also the discharge of any person's liability, other than a liability for a liquidated sum.

F29 mod. by SR 2004/307

“Body corporate” and “corporation” N.I.

8 .F30   References in this Order to a body corporate or to a corporation do not include a corporation sole, but include a company incorporated elsewhere than in Northern Ireland.

Such references to a body corporate do not include a Scottish firm.

F30 mod. by SR 2004/307

“Director” and “shadow director” N.I.

9.  F31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F31 Art. 9 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

[F32 Expressions used in connection with accounts N.I.

10 .F33 — (1) In this Order the following expressions have the same meaning as in Part VIII (accounts)—

• “annual accounts”,

• “accounting reference date” and “accounting reference period”,

• “balance sheet” and “balance sheet date”,

• [F34 “Companies Order accounts”]

• [F34 “Companies Order individual accounts”]

• “current assets”,

• “financial year”, in relation to a company,

• “fixed assets”,

• [F34 “IAS accounts”]

• [F34 “IAS individual accounts”]

• “parent company” and “parent undertaking”,

• “profit and loss account”, and

• “subsidiary undertaking”.

(2) References in this Order to “realised profits” and “realised losses”, in relation to a company's accounts, shall be construed in accordance with Article 270(3).

[F35 (3) References in this Order to sending or sending out copies of any of the documents referred to in Article 246(1) include sending or sending out such copies in accordance with Article 246(4A) or (4B).]]

F32 1990 NI 5, art. 25

F33 mod. by SR 2004/307

F34 SR 2004/496

F35 SR 2003/3

[F36 Meaning of “offer to the public” N.I.

10A.— (1) Any reference in[F37 Article 2(3) (interpretation),] Part V (allotment of shares and debentures) or Part VIII (accounts) to offering shares or debentures to the public is to be read as including a reference to offering them to any section of the public, however selected.

(2) This Article does not require an offer to be treated as made to the public if it can properly be regarded, in all the circumstances—

(a) as not being calculated to result, directly or indirectly, in the shares or debentures becoming available for subscription or purchase by persons other than those receiving the offer; or

(b) as being a domestic concern of the persons receiving and making it.

(3) An offer of shares in or debentures of a private company (other than an offer to which paragraph (5) applies) is to be regarded (unless the contrary is proved) as being a domestic concern of the persons making and receiving it if—

(a) it is made to—

(i) an existing member of the company making the offer;

(ii) an existing employee of that company;

(iii) the[F38 surviving spouse or surviving civil partner] of a person who was a member or employee of that company;

(iv) a member of the family of a person who is or was a member or employee of that company; or

(v) an existing debenture holder; or

(b) it is an offer to subscribe for shares or debentures to be held under an employee's share scheme.

(4) Paragraph (5) applies to an offer—

(a) which falls within sub-paragraph (a) or (b) of paragraph (3); but

(b) which is made on terms which permit the person to whom it is made to renounce his right to the allotment of shares or issue of debentures.

(5) The offer is to be regarded (unless the contrary is proved) as being a domestic concern of the persons making and receiving it if the terms are such that the right may be renounced only in favour—

(a) of any person mentioned in paragraph (3)(a); or

(b) in the case of an employee's share scheme, of a person entitled to hold shares or debentures under the scheme.

(6) For the purposes of paragraph (3)(a)(iv), the members of a person's family are—

(a) the person's spouse[F38 or civil partner] and children (including step-children) and their descendants, and

(b) any trustee (acting in his capacity as such) of a trust the principal beneficiary of which is the person him or herself or of any of those relatives.

(7) Where an application has been made to the competent authority in any EEA State for the admission of any securities to official listing, then an offer of those securities for subscription or sale to a person whose ordinary business it is to buy or sell shares or debentures (whether as principal or agent) is not to be regarded as an offer to the public for the purposes of this Part.

(8) For the purposes of paragraph (7)—

(a) “competent authority” means a competent authority appointed for the purposes of the Council Directive of 28 May 2001 on the admission of securities to official stock exchange listing and on information to be published on those securities; and

(b) “official listing” means official listing pursuant to that directive.]

F36 Arts. 10A-10C inserted by S.I. 2001/3649, art. 43

F37 SI 2004/355

F38 2004 c.33

F39 Meaning of “banking company” N.I.

10B—(1) Subject to paragraph (2), "banking company" means a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to accept deposits.

(2) A banking company does not include—

(a) a person who is not a company, and

(b) a person who has permission to accept deposits only for the purpose of carrying on another regulated activity in accordance with that permission.

(3) This Article must be read with—

(a) section 22 of the Financial Services and Markets Act 2000;

(b) any relevant order under that section; and

(c) Schedule 2 to that Act.

F39 Arts. 10A-10C inserted by S.I. 2001/3649, art. 43

F40 Meaning of “insurance company” and “authorised insurance company” N.I.

10C—(1) For the purposes of this Order, "insurance company" has the meaning given in paragraph (2) and "authorised insurance company" has the meaning given in paragraph (4).

(2) Subject to paragraph (3), "insurance company" means a person (whether incorporated or not)—

(a) who has permission under Part 4 of the Financial Services and Markets Act 2000 to effect or carry out contracts of insurance;

(b) who carries on insurance market activity; or

(c) who may effect or carry out contracts of insurance under which the benefits provided by that person are exclusively or primarily benefits in kind in the event of accident to or breakdown of a vehicle, and does not fall within sub-paragraph (a).

(3) An insurance company does not include a friendly society, within the meaning of section 116 of the Friendly Societies Act 1992.

(4) An “authorised insurance company” means a person falling within sub-paragraph (a) of paragraph (2).

(5) References in this Article to contracts of insurance and the effecting or carrying out of such contracts must be read with—

(a) section 22 of the Financial Services and Markets Act 2000;

(b) any relevant order under that section; and

(c) Schedule 2 to that Act.]

F40 Arts. 10A-10C inserted by S.I. 2001/3649, art. 43

“Employees' share scheme” N.I.

11.  For the purposes of this Order, an employees' share scheme is a scheme for encouraging or facilitating the holding of shares or debentures in a company by or for the benefit of—

(a) the bona fide employees or former employees of the company, the company's subsidiary or holding company or a subsidiary of the company's holding company, or

(b) the[F41 spouses, civil partners, surviving spouses, surviving civil partners] or children, step-children or adopted children under the age of 18 of such employees or former employees.

F41 2004 c.33

PART IIF1029 N.I. FORMATION AND REGISTRATION OF COMPANIES; JURIDICAL STATUS AND MEMBERSHIP

CHAPTER IF1029 N.I. COMPANY FORMATION

Memorandum of associationF1029 N.I.

Mode of forming incorporated company N.I.

12.—(1) Any two or more persons associated for a lawful purpose may, by subscribing their names to a memorandum of association and otherwise complying with the requirements of this Order in respect of registration, form an incorporated company, with or without limited liability.

(2) A company so formed may be either—

(a) a company having the liability of its members limited by the memorandum to the amount, if any, unpaid on the shares respectively held by them ( “a company limited by shares”);

(b) a company having the liability of its members limited by the memorandum to such amount as the members may respectively thereby undertake to contribute to the assets of the company in the event of its being wound up ( “a company limited by guarantee”); or

(c) a company not having any limit on the liability of its members ( “an unlimited company”).

(3) A “public company” is a company limited by shares or limited by guarantee and having a share capital, being a company—

(a) the memorandum of which states that it is to be a public company, and

(b) in relation to which the provisions of this Order or the former Companies Acts as to the registration or re-registration of a company as a public company have been complied with on or after 1st July 1983;

and a “private company” is a company that is not a public company.

[F42 (3A)  Notwithstanding paragraph (1), one person may, for a lawful purpose, by subscribing his name to a memorandum of association and otherwise complying with the requirements of this Order in respect of registration, form an incorporated company being a private company limited by shares or by guarantee.]

(4) With effect from 1st July 1983, a company cannot be formed as, or become, a company limited by guarantee with a share capital.

F42 SR 1992/405

Requirements with respect to memorandum N.I.

13.—(1) The memorandum of every company must state—

(a) the name of the company;

(b) that the registered office of the company is to be situated in Northern Ireland;

(c) the objects of the company.

(2) The memorandum of a company limited by shares or by guarantee must also state that the liability of its members is limited.

(3) The memorandum of a company limited by guarantee must also state that each member undertakes to contribute to the assets of the company in the event of its being wound up while he is a member, or within one year after he ceases to be a member, for payment of the debts and liabilities of the company contracted before he ceases to be a member, and of the costs, charges and expenses of winding up, and for adjustment of the rights of the contributories among themselves, such amount as may be required, not exceeding a specified amount.

(4) In the case of a company having a share capital—

(a) the memorandum must also (unless the company is an unlimited company) state the amount of the share capital with which the company proposes to be registered and the division of the share capital into shares of a fixed amount;

(b) no subscriber of the memorandum may take less than one share; and

(c) there must be shown in the memorandum against the name of each subscriber the number of shares he takes.

(5) [F43 Subject to paragraph (5A), the memorandum] must be signed by each subscriber in the presence of at least one witness, who must attest the signature.

[F43 (5A) Where the memorandum is delivered to the registrar otherwise than in legible form and is authenticated by each subscriber in such manner as is directed by the registrar, the requirements in paragraph (5) for signature in the presence of at least one witness and for attestation of the signature do not apply.]

(6) A company may not alter the conditions contained in its memorandum except in the cases, in the mode and to the extent, for which express provision is made by this Order.

F43 SR 2003/3

Forms of memorandum N.I.

14.  Subject to the provisions of Articles 12 and 13, the form of the memorandum of association of—

(a) a public company, being a company limited by shares,

(b) a public company, being a company limited by guarantee and having a share capital,

(c) a private company limited by shares,

(d) a private company limited by guarantee and not having a share capital,

(e) a private company limited by guarantee and having a share capital, and

(f) an unlimited company having a share capital,

shall be as prescribed respectively for such companies by regulations, made by the Department, or as near to that form as circumstances admit.

[F44 Statement of company's objects: general commercial company N.I.

14A.   Where the company's memorandum states that the object of the company is to carry on business as a general commercial company—

(a) the object of the company is to carry on any trade or business whatsoever, and

(b) the company has power to do all such things as are incidental or conducive to the carrying on of any trade or business by it.]

F44 1990 NI 10

[F45 Resolution to alter objects N.I.

15.— (1) A company may by special resolution alter its memorandum with respect to the statement of the company's objects.

(2) If an application is made under Article 16, an alteration does not have effect except in so far as it is confirmed by the court.]

F45 1990 NI 10, 46(2)

Procedure for objecting to alteration N.I.

16.—(1) Where a company's memorandum has been altered by special resolution under Article 15, application may be made to the court for the alteration to be cancelled.

(2) Such an application may be made—

(a) by the holders of not less in the aggregate than 15 per cent. in nominal value of the company's issued share capital or any class of it or, if the company is not limited by shares, not less than 15 per cent. of the company's members; or

(b) by the holders of not less than 15 per cent. of the company's debentures entitling the holders to object to an alteration of its objects;

but an application shall not be made by any person who has consented to or voted in favour of the alteration.

(3) The application must be made within 21 days after the date on which the resolution altering the company's objects was passed, and may be made on behalf of the persons entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.

(4) The court may on such an application make an order confirming the alteration either wholly or in part and on such terms and conditions as it thinks fit, and may—

(a) if it thinks fit, adjourn the proceedings in order that an arrangement may be made to its satisfaction for the purchase of the interests of dissentient members, and

(b) give such directions and make such orders as it thinks expedient for facilitating or carrying into effect any such arrangement.

(5) The court's order may (if the court thinks fit) provide for the purchase by the company of the shares of any members of the company, and for the reduction accordingly of its capital, and may make such alterations in the company's memorandum and articles as may be required in consequence of that provision.

(6) If the court's order requires the company not to make any, or any specified, alteration in its memorandum or articles, the company does not then have power without the leave of the court to make any such alteration in breach of that requirement.

(7) An alteration in the memorandum or articles of a company made by virtue of an order under this Article, other than one made by resolution of the company, is of the same effect as if duly made by resolution; and this Order applies accordingly to the memorandum or articles as so altered.

[F46 (7A) For the purposes of paragraph (2)(a), any of the company's issued share capital held as treasury shares must be disregarded.]

(8) The debentures entitling the holders to object to an alteration of a company's objects are any debentures secured by a floating charge which were issued or first issued before 1st April 1961 or form part of the same series as any debentures so issued; and a special resolution altering a company's objects requires the same notice to the holders of any such debentures as to members of the company.

In the absence of provisions regulating the giving of notice to any such debenture holders, the provisions of the company's articles regulating the giving of notice to members apply.

F46 SR 2004/275

Provisions supplementing Articles 15 and 16 N.I.

17.—(1) Where a company passes a resolution altering its objects, then—

(a) if with respect to the resolution no application is made under Article 16, the company shall within 15 days from the end of the period for making such an application deliver to the registrar a printed copy of its memorandum as altered; and

(b) if such an application is made, the company shall—

(i) forthwith give notice (in the prescribed form) of that fact to the registrar, and

(ii) within 15 days from the date of any order cancelling or confirming the alteration, deliver to the registrar an office copy of the order and, in the case of an order confirming the alteration, a printed copy of the memorandum as altered.

(2) The court may by order at any time extend the time for the delivery of documents to the registrar under paragraph (1)(b) for such period as the court may think proper.

(3) If a company makes default in giving notice or delivering any document to the registrar as required by paragraph (1), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(4) The validity of an alteration of a company's memorandum with respect to the objects of the company shall not be questioned on the ground that it was not authorised by Article 15, except in proceedings taken for the purpose (whether under Article 16 or otherwise) before the expiration of 21 days after the date of the resolution in that behalf.

(5) Where such proceedings are taken otherwise than under Article 16, paragraphs (1) to (3) apply in relation to the proceedings as if they had been taken under that Article and as if an order declaring the alteration invalid were an order cancelling it, and as if an order dismissing the proceedings were an order confirming the alteration.

Modifications etc. (not altering text)

C1 Art. 17(3) applied (prosp.) by Charities Act (Northern Ireland) 2008 (c. 12), ss. 96(6), 185(1)

Articles of associationF1029 N.I.

Regulation of companies by articles of association N.I.

18.—(1) There may in the case of a company limited by shares, and there shall in the case of a company limited by guarantee or unlimited, be registered with the memorandum articles of association signed by the subscribers to the memorandum and making regulations for the company.

(2) In the case of an unlimited company having a share capital, its articles must state the amount of share capital with which the company proposes to be registered.

(3) Articles of association must—

(a) be printed,

(b) be divided into paragraphs numbered consecutively, and

(c) [F47 subject to paragraph (4),] be signed by each subscriber of the memorandum in the presence of at least one witness who must attest the signature.

[F47 (4) Where the articles are delivered to the registrar otherwise than in legible form and are authenticated by each subscriber to the memorandum in such manner as is directed by the registrar, the requirements in paragraph (3)(c) for signature in the presence of at least one witness and for attestation of the signature do not apply.]

F47 SR 2003/3

Tables A, C, D and E N.I.

19.—(1) Table A is as prescribed by regulations made by the Department; and a company may for its articles adopt the whole or any part of that Table.

(2) In the case of a company limited by shares, if articles are not registered or, if articles are registered, in so far as they do not exclude or modify Table A, that Table (so far as applicable, and as in force at the date of the company's registration) constitutes the company's articles in the same manner and to the same extent as if articles in the form of that Table had been duly registered.

(3) If in consequence of regulations under this Article Table A is altered, the alteration does not affect a company registered before the alteration takes effect, or revoke as respects that company any portion of the Table.

(4) The form of the articles of association of—

(a) a company limited by guarantee and not having a share capital,

(b) a company limited by guarantee and having a share capital, and

(c) an unlimited company having a share capital,

shall be respectively in accordance with Table C, D or E prescribed by regulations made by the Department or as near to that form as circumstances admit.

Prospective

{prosp. insertion of art. 19A by 1990 NI10} N.I.

F48 Art. 19A inserted (prosp.) by 1990 NI 10

Alteration of articles by special resolution N.I.

20.—(1) Subject to the provisions of this Order and to the conditions contained in its memorandum, a company may by special resolution alter its articles.

(2) Alterations so made in the articles are (subject to this Order) as valid as if originally contained in them and are subject in like manner to alteration by special resolution.

Registration and its consequencesF1029 N.I.

Documents to be sent to registrar N.I.

21.—(1) A company's memorandum and articles (if any) shall be delivered to the registrar.

(2) With the memorandum there shall be delivered a statement in the prescribed form containing the names and requisite particulars of—

(a) the person who is, or the persons who are, to be the first director or directors of the company; and

(b) the person who is, or the persons who are, to be the first secretary or joint secretaries of the company;

and the requisite particulars in each case are those set out in Schedule 1.

(3) The statement shall be signed by or on behalf of the subscribers of the memorandum and shall contain a consent signed by each of the persons named in it as a director, as secretary or as one of joint secretaries, to act in the relevant capacity.

(4) Where a memorandum is delivered by a person as agent for the subscribers, the statement shall specify that fact and the person's name and address.

(5) An appointment by a company's articles delivered with the memorandum of a person as director or secretary of the company is void unless he is named as a director or secretary in the statement.

(6) There shall in the statement be specified the intended situation of the company's registered office on incorporation.

Minimum authorised capital (public companies) N.I.

22.  When a memorandum delivered to the registrar under Article 21 states that the association to be registered is to be a public company, the amount of the share capital stated in the memorandum to be that with which the company proposes to be registered must not be less than the authorised minimum.

Duty of registrar N.I.

23.—(1) The registrar shall not register a company's memorandum delivered under Article 21 unless he is satisfied that all the requirements of this Order in respect of registration and of matters precedent and incidental to it have been complied with.

(2) Subject to this, the registrar shall retain and register the memorandum and articles (if any) delivered to him under that Article.

(3) [F49 Subject to paragraph (4), a statutory declaration] in the prescribed form by—

(a) a solicitor engaged in the formation of a company, or

(b) a person named as a director or secretary of the company in the statement delivered under Article 21(2),

that those requirements have been complied with shall be delivered to the registrar and the registrar may accept such a declaration as sufficient evidence of compliance.

[F49 (4) In place of the statutory declaration referred to in paragraph (3), there may be delivered to the registrar using electronic communications a statement made by a person mentioned in sub-paragraph (a) or (b) of paragraph (3) that the requirements mentioned in paragraph (1) have been complied with; and the registrar may accept such a statement as sufficient evidence of compliance.

(5) Any person who makes a false statement under paragraph (4) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

F49 SR 2003/3

Effect of registration N.I.

24.—(1) On the registration of a company's memorandum, the registrar shall give a certificate that the company is incorporated and, in the case of a limited company, that it is limited.

(2) The certificate shall be given under the registrar's hand.

(3) From the date of incorporation mentioned in the certificate, the subscribers of the memorandum, together with such other persons as may from time to time become members of the company, shall be a body corporate by the name contained in the memorandum.

(4) That body corporate is then capable forthwith of exercising all the functions of an incorporated company, but with such liability on the part of its members to contribute to its assets in the event of its being wound up as is provided by this Order[F50 and the Insolvency Order].

This is subject, in the case of a public company, to Article 127 (additional certificate as to compliance with share capital requirements).

(5) The persons named in the statement under Article 21 as directors, secretary or joint secretaries are, on the company's incorporation, deemed to have been respectively appointed as its first directors, secretary or joint secretaries.

(6) Where the registrar registers an association's memorandum which states that the association is to be a public company, the certificate of incorporation shall contain a statement that the company is a public company.

(7) A certificate of incorporation given in respect of an association is conclusive evidence—

(a) that the requirements of this Order in respect of registration and of matters precedent and incidental to it have been complied with, and that the association is a company authorised to be registered, and is duly registered, under this Order; and

(b) if the certificate contains a statement that the company is a public company, that the company is such a company.

F50 1989 NI 19

Effect of memorandum and articles N.I.

25.—(1) Subject to the provisions of this Order, the memorandum and articles, when registered, bind the company and its members to the same extent as if they respectively had been signed and sealed by each member, and contained covenants on the part of each member to observe all the provisions of the memorandum and of the articles.

(2) Money payable by a member to the company under the memorandum or articles is a debt due from him to the company.

Memorandum and articles of company limited by guarantee N.I.

26.—(1) In the case of a company limited by guarantee and not having a share capital, every provision in the memorandum or articles, or in any resolution of the company purporting to give any person a right to participate in the divisible profits of the company otherwise than as a member, is void.

(2) For the purposes of provisions of this Order relating to the memorandum of a company limited by guarantee, and for those of Article 12(4) and this Article, every provision in the memorandum or articles, or in any resolution, of a company so limited purporting to divide the company's undertaking into shares or interests is to be treated as a provision for a share capital, notwithstanding that the nominal amount or number of the shares or interests is not specified by the provision.

Effect of alteration on company's members N.I.

27.—(1) A member of a company is not bound by an alteration made in its memorandum or articles after the date on which he became a member, if and so far as the alteration—

(a) requires him to take or subscribe for more shares than the number held by him at the date on which the alteration is made; or

(b) in any way increases his liability as at that date to contribute to the company's share capital or otherwise to pay money to the company.

(2) Paragraph (1) operates notwithstanding anything in the memorandum or articles; but it does not apply in a case where the member agrees in writing, either before or after the alteration is made, to be bound by the alteration.

Conditions in memorandum which could have been in articles N.I.

28.—(1) A condition contained in a company's memorandum which could lawfully have been contained in articles of association instead of in the memorandum may be altered by the company by special resolution; but if an application is made to the court for the alteration to be cancelled, the alteration does not have effect except in so far as it is confirmed by the court.

(2) This Article—

(a) is subject to Article 27, and also to Part XVIII (court order protecting minority), and

(b) does not apply where the memorandum itself provides for or prohibits the alteration of all or any of the conditions referred to in paragraph (1), and does not authorise any variation or abrogation of the special rights of any class of members.

(3) Article 16 (except paragraphs (2)(b) and (8)) and Article 17(1) to (3) apply in relation to any alteration and to any application made under this Article as they apply in relation to alterations and applications under Articles 15 to 17.

Amendments of memorandum or articles to be recorded N.I.

29.—F51 (1) Where an alteration is made in a company's memorandum or articles by any statutory provision, a printed copy of the statutory provision shall, not later than 15 days after that provision comes into operation, be forwarded to the registrar and recorded by him.

(2) Where a company is required (by this Article or otherwise) to send to the registrar any document making or evidencing an alteration in the company's memorandum or articles (other than a special resolution under Article 15) the company shall send with it a printed copy of the memorandum or articles as altered.

(3) If a company fails to comply with this Article, the company and any officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F51 mod. by SR 1986/305

Copies of memorandum and articles to be given to members N.I.

30.—(1) A company shall, on being so required by any member, send to him a copy of its memorandum and of its articles (if any), and a copy of any statutory provision which alters the memorandum, subject to payment—

(a) in the case of a copy of the memorandum and of the articles, of 5 pence or such less sum as the company may determine, and

(b) in the case of a copy of a statutory provision, of such sum not exceeding its published price as the company may require.

(2) If a company makes default in complying with this Article, the company and every officer of it who is in default is liable for each offence to a fine.

Issued copy of memorandum to embody alterations N.I.

31.—(1) Where an alteration is made in a company's memorandum, every copy of the memorandum issued after the date of the alteration shall be in accordance with the alteration.

(2) If, where any such alteration has been made, the company at any time after the date of the alteration issues any copies of the memorandum which are not in accordance with the alteration, it is liable to a fine, and so too is every officer of the company who is in default.

A company's membershipF1029 N.I.

Definition of “member” N.I.

32.—(1) The subscribers of a company's memorandum are deemed to have agreed to become members of the company, and on its registration shall be entered as such in its register of members.

(2) Every other person who agrees to become a member of a company, and whose name is entered in its register of members, is a member of the company.

[F52 Membership of holding company N.I.

33.— (1) Except as mentioned in this Article, a body corporate cannot be a member of a company which is its holding company and any allotment or transfer of shares in a company to its subsidiary is void.

(2) The prohibition does not apply where the subsidiary is concerned only as personal representative or trustee unless, in the latter case, the holding company or a subsidiary of it is beneficially interested under the trust.

For the purpose of ascertaining whether the holding company or a subsidiary is so interested, there shall be disregarded—

(a) any interest held only by way of security for the purposes of a transaction entered into by the holding company or subsidiary in the ordinary course of a business which includes the lending of money;

(b) any such interest as is mentioned in Part I of Schedule 2.

[F53 (3) The prohibition does not apply where shares in the holding company are held by the subsidiary in the ordinary course of its business as an intermediary.

For this purpose a person is an intermediary if that person—

(a) carries on a bona fide business of dealing in securities;

(b) is a member of an EEA exchange (and satisfies any requirements for recognition as a dealer in securities laid down by that exchange) or is otherwise approved or supervised as a dealer in securities under the laws of an EEA State; and

(c) does not carry on an excluded business.

(3A) The excluded businesses are the following—

(a) any business which consists wholly or mainly in the making or managing of investments;

(b) any business which consists wholly or mainly in, or is carried on wholly or mainly for the purpose of, providing services to persons who are connected with the person carrying on the business;

(c) any business which consists in insurance business;

(d) any business which consists in managing or acting as trustee in relation to a pension scheme or which is carried on by the manager or trustee of such a scheme in connection with or for the purposes of the scheme;

(e) any business which consists in operating or acting as trustee in relation to a collective investment scheme or is carried on by the operator or trustee of such a scheme in connection with or for the purposes of the scheme.

(3B) For the purposes of paragraphs (3) and (3A)—

(a) the question whether a person is connected with another shall be determined in accordance with the provisions of section 839 of the Income and Corporation Taxes Act 1988;

(b) “collective investment scheme” has the meaning given in section 235 of the Financial Services and Markets Act 2000;

(c) “EEA exchange” means a market which appears on the list drawn up by an EEA State pursuant to Article 16 of Council Directive 93/22/EEC on investment services in the securities field;

(d) “insurance business” means business which consists of the effecting or carrying out of contracts of insurance;

(e) “securities” includes—

(i) options,

(ii) futures, and

(iii) contracts for differences,

and rights or interests in those investments;

(f) “trustee” and “the operator” shall, in relation to a collective investment scheme, be construed in accordance with section 237(2) of the Financial Services and Markets Act 2000.

(3C) Paragraph (3B) must be read with—

(a) section 22 of the Financial Services and Markets Act 2000;

(b) any relevant order under that section; and

(c) Schedule 2 to that Act.

(3D) Where—

(a) a subsidiary which is a dealer in securities has purportedly acquired shares in its holding company in contravention of the prohibition in paragraph (1); and

(b) a person acting in good faith has agreed, for value and without notice of that contravention, to acquire shares in the holding company from the subsidiary or from someone who has purportedly acquired the shares after their disposal by the subsidiary,

any transfer to that person of the shares mentioned in sub-paragraph (a) shall have the same effect as it would have had if their original acquisition by the subsidiary had not been in contravention of the prohibition.]

(4) Where a body corporate became a holder of shares in a company—

(a) before 1st April 1961, or

(b) on or after that date and before[F53 2nd August 2004], in circumstances in which this Article as it then had effect did not apply,

but at any time[F53 on or after 2nd August 2004] falls within the prohibition in paragraph (1) in respect of those shares, it may continue to be a member of that company; but for so long as that prohibition would apply, apart from this paragraph, it has no right to vote in respect of those shares at meetings of the company or of any class of its members.

(5) Where a body corporate becomes a holder of shares in a company[F53 on or after 2nd August 2004.] in circumstances in which the prohibition in paragraph (1) does not apply, but subsequently falls within that prohibition in respect of those shares, it may continue to be a member of that company; but for so long as that prohibition would apply, apart from this paragraph, it has no right to vote in respect of those shares at meetings of the company or of any class of its members.

(6) Where a body corporate is permitted to continue as a member of a company by virtue of paragraph (4) or (5), an allotment to it of fully paid shares in the company may be validly made by way of capitalisation of reserves of the company; but for so long as the prohibition in paragraph (1) would apply, apart from paragraph (4) or (5), it has no right to vote in respect of those shares at meetings of the company or of any class of its members.

(7) The provisions of this Article apply to a nominee acting on behalf of a subsidiary as to the subsidiary itself.

(8) In relation to a company other than a company limited by shares, the references in this Article to shares shall be construed as references to the interest of its members as such, whatever the form of that interest.]

F52 1990 NI 10, art/ 64(1)

F53 SR 2004/263

Minimum membership for carrying on business N.I.

34 .F54 — [F55 (1)] If a company[F56 , other than a private company limited by shares or by guarantee,] carries on business without having at least two members and does so for more than 6 months, a person who, for the whole or any part of the period that it so carries on business after those 6 months—

(a) is a member of the company, and

(b) knows that it is carrying on business with only one member,

is liable (jointly and severally with the company) for the payment of the company's debts contracted during the period or, as the case may be, that part of it.

[F55 (2) For the purposes of this Article references to a member of a company do not include the company itself where it is such a member only by virtue of its holding shares as treasury shares.]

F54 mod. by SR 2004/307

F55 SR 2004/275

F56 SR 1992/405

CHAPTER IIF1029 N.I. COMPANY NAMES

Name as stated in memorandum N.I.

35.—(1) The name of a public company must end with the words “public limited company” and those words may not be preceded by the word “limited”.

(2) In the case of a company limited by shares or by guarantee (not being a public company), the name must have “limited” as its last word, subject to Article 40 (exempting, in certain circumstances, a company from the requirement to have “limited” as part of the name).

Prohibition on registration of certain names N.I.

36.—(1) A company shall not be registered under this Order by a name—

(a) which includes, otherwise than at the end of the name, any of the following words or expressions, that is to say, “limited”, “unlimited”[F57 , “public limited company”, “community interest company” or “community interest public limited company”];

(b) which includes otherwise than at the end of the name an abbreviation of any of those words or expressions;

[F58 (bb) which includes, at any place in the name, the expression “investment company with variable capital” or “open‐ended investment company”;]

[F59 (bbb) which includes, at any place in the name, the expression “limited liability partnership”;]

(c) which is the same as a name appearing in the registrar's index of company names;

(d) the use of which by the company would in the opinion of the Department constitute a criminal offence; or

(e) which in the opinion of the Department is offensive.

(2) Except with the approval of the Department, a company shall not be registered under this Order by a name which—

(a) in the opinion of the Department would be likely to give the impression that the company is connected in any way with Her Majesty's Government or with any district council; or

(b) includes any word or expression for the time being prescribed in regulations under Article 39.

(3) In determining for the purposes of paragraph (1)(c) whether one name is the same as another, there are to be disregarded—

(a) the definite article, where it is the first word of the name;

(b) the following words and expressions where they appear at the end of the name, that is to say—

“company”, “and company”, “company limited”, “and company limited”, “limited”, “unlimited”F60 . . . “public limited company”[F61 , “community interest company”, “community interest public limited company”,][F60 F58 . . . “investment company with variable capital”;][F58 and open‐ended investment company]

(c) abbreviations of any of those words or expressions where they appear at the end of the name; and

(d) type and case of letters, accents, spaces between letters and punctuation marks;

and “and” and “&” are to be taken as the same.

F57 Words in art. 36(1)(a) substituted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 48(a) (with art. 11(1))

F58 SR 2004/335

F59 SR 2004/307

F60 SR 1997/251

F61 Words in art. 36(3)(b) inserted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 48(b) (with art. 11(1))

Modifications etc. (not altering text)

C2 Art. 36(3) applied (with modifications) (prosp.) by Charities Act (Northern Ireland) 2008 (c. 12), ss. 20(7), 185(1)

Alternatives of statutory designations N.I.

37.—(1) A company which by any provision of this Order is either required or entitled to include in its name, as the last part, any of the words specified in paragraph (4) may, instead of those words, include as the last part of its name the abbreviations there specified as alternatives in relation to those words.

(2) A reference in this Order to the name of a company or to the inclusion of any of those words in a company's name includes a reference to the name including (in place of any of the words so specified) the appropriate alternative, or to the inclusion of the appropriate alternative, as the case may be.

(3) A provision of this Order requiring a company not to include any of those words in its name also requires it not to include the abbreviated alternative specified in paragraph (4).

(4) For the purposes of this Article—

(a) the alternative of “limited” is “ltd.”; and

(b) the alternative of “public limited company” is “p.l.c.”[F62 ; and

(c) the alternative of “community interest company” is “c.i.c.”; and

(d) the alternative of “community interest public limited company” is “community interest p.l.c.”.]

F62 Art. 37(4)(c)(d) and preceding word inserted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 49 (with art. 11(1))

Change of name N.I.

38.—(1) A company may by special resolution change its name (but subject to Article 41 in the case of a company which has received a direction under paragraph (2) of that Article from the Department).

(2) Where a company has been registered by a name which—

(a) is the same as or, in the opinion of the Department, too like a name appearing at the time of the registration in the registrar's index of company names, or

(b) is the same as or, in the opinion of the Department, too like a name which should have appeared in that index at that time,

the Department may within 12 months of that time, in writing, direct the company to change its name within such period as the Department may specify.

Article 36(3)applies in determining under this paragraph whether a name is the same as or too like another.

(3) If it appears to the Department that misleading information has been given for the purpose of a company's registration with a particular name, or that undertakings or assurances have been given for that purpose and have not been fulfilled, the Department may within 5 years of the date of the company's registration with that name in writing direct the company to change its name within such period as the Department may specify.

(4) Where a direction has been given under paragraph (2) or (3), the Department may by a further direction in writing extend the period within which the company is to change its name, at any time before the end of that period.

(5) A company which fails to comply with a direction under this Article, and any officer of it who is in default, is liable to a fine and, for continued contravention, to a daily default fine.

(6) Where a company changes its name under this Article, the registrar shall (subject to Article 36) enter the new name on the register in place of the former name, and shall issue a certificate of incorporation altered to meet the circumstances of the case; and the change of name has effect from the date on which the altered certificate is issued.

(7) A change of name by a company under this Article does not affect any rights or obligations of the company or render defective any legal proceedings by or against it; and any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its new name.

Regulations about names N.I.

39.— [F63 (1) The Department may by regulations—

(a) prescribe words or expressions for the registration of which as or as part of a company's corporate name the Department's approval is required under Article 36(2)(b), and

(b) in relation to any such word or expression, prescribe a government department or other body as the relevant body for the purposes of paragraph (2).

(2) Where a company proposes to have as, or as part of, its corporate name any such word or expression in relation to which a relevant body has been prescribed under paragraph (1)(b), a request shall be made (in writing) to the relevant body to indicate whether (and if so why) it has any objections to the proposal; and the person to make the request is—

(a) in the case of a company seeking to be registered under this Part, the person making the statutory declaration[F64 under Article 23(3) or statement under Article 23(4) (as the case may be)],

(b) in the case of a company seeking to be registered under Article 629, the persons making the statutory declaration[F64 under Article 635(2) or statement under Article 635(2A) (as the case may be)], and

(c) in any other case, a director or secretary of the company concerned.

(3) The person who has made that request to the relevant body shall submit to the registrar a statement that it has been made and a copy of any response received from that body, together with—

(a) the requisite statutory declaration[F64 or statement], or

(b) a copy of the special resolution changing the company's name,

according as the case is the one or the other of those mentioned in paragraph (2).

(4) Articles 658 and 659 (public inspection of documents kept by registrar) do not apply to documents sent under paragraph (3) other than documents mentioned in sub-paragraphs (a) and (b) of that paragraph.

(5) Regulations under this Article may contain such transitional provisions and savings as the Department thinks appropriate.

(6) The regulations shall be laid before the Assembly after being made and shall cease to have effect at the end of the statutory period next after the regulations have been so laid (but without prejudice to anything previously done by virtue of the regulations or to the making of new regulations) unless during that period they are approved by a resolution of the Assembly.]

F63 Art. 39 repealed (1.1.2007 for certain purposes, otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(a), Sch. 2 Pt. 2 (with arts. 6, 8, Sch. 5)

F64 SR 2003/3

Exemption from requirement of “limited” as part of the name N.I.

40.—(1) Certain companies are exempt from requirements of this Order relating to the use of the word “limited” as part of the company name.

(2) A private company (including a private company about to be registered) limited by guarantee is exempt from those requirements and so too is a company which on 30th June 1983 was a private company limited by shares with a name which, by virtue of a licence under section 19 of the Act of 1960, did not include the word “limited”; but in either case the company must, to have the exemption, comply with the requirements of paragraph (3).

(3) Those requirements are that—

(a) the objects to the company are (or, in the case of a company about to be registered, are to be) the promotion of commerce, art, science, education, religion, charity or any profession, and anything incidental or conducive to any of those objects; and

(b) the company's memorandum or articles—

(i) require its profits (if any) or other income to be applied in promoting its objects,

(ii) prohibit the payment of dividends to its members, and

(iii) require all the assets which would otherwise be available to its members generally to be transferred on its winding up either to another body with objects similar to its own or to another body the objects of which are the promotion of charity and anything incidental or conducive thereto (whether or not the body is a member of the company).

(4) [F65 Subject to paragraph (5A), a statutory declaration] that a company complies with the requirements of paragraph (3) may be delivered to the registrar, who may accept the declaration as sufficient evidence of the matters stated in itF65 . . . .

(5) The statutory declaration must be in the prescribed form and be made—

(a) in the case of a company to be formed, by a solicitor engaged in its formation or by a person named as director or secretary in the statement delivered under Article 21(2);

(b) in the case of a company to be registered in pursuance of Article 629, by two or more directors or other principal officers of the company; and

(c) in the case of a company proposing to change its name so that it ceases to have the word “limited” as part of its name, by a director or secretary of the company.

[F65 (5A) In place of the statutory declaration referred to in paragraph (4), there may be delivered to the registrar using electronic communications a statement made by a person falling within the applicable sub-paragraph of paragraph (5) stating that the company complies with the requirements of paragraph (3); and the registrar may accept such a statement as sufficient evidence of the matters stated in it.

(5B) The registrar may refuse to register a company by a name which does not include the word “limited” unless a statutory declaration under paragraph (4) or statement under paragraph (5A) has been delivered to him.

(5C) Any person who makes a false statement under paragraph (5A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

(6) References in this Article to the word “limited” include the appropriate alternative.

(7) A company which[F66 under this Article] is exempt from requirements relating to the use of the word “limited” and does not include that word as part of its name, is also exempt from the requirements of this Order relating to the publication of its name and the sending of lists of members to the registrar.

F65 SR 2003/3

F66 Words in art. 40(7) inserted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 50 (with art. 11(1))

Provisions applying to company exempt under Article 40 N.I.

41.—(1) A company which is exempt under Article 40 and whose name does not include the word “limited” shall not alter its memorandum or articles so that it ceases to comply with the requirements of paragraph (3) of that Article.

(2) If it appears to the Department that such a company—

(a) has carried on any business other than the promotion of any of the objects mentioned in that paragraph; or

(b) has applied any of its profits or other income otherwise than in promoting such objects; or

(c) has paid a dividend to any of its members,

the Department may, in writing, direct the company to change its name by resolution of the directors within such period as may be specified in the direction, so that its name ends with the word “limited”.

F67 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F68 (2A) Where such a resolution is passed by the directors, the company must give notice to the registrar of the change.

(2B) Where a company changes its name under this Article, the registrar shall (subject to Article 36) enter the new name on the register in place of the former name, and shall issue a certificate of incorporation altered to meet the circumstances of the case; and the change of name has effect from the date on which the altered certificate is issued.

(2C) A change of name by a company under this Article does not affect any right or obligations of the company or render defective any legal proceedings by or against it; and any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its new name.]

(3) A company which has received a direction under paragraph (2) shall not thereafter be registered by a name which does not include the word “limited”, without the approval of the Department.

(4) References in this Article to the word “limited” include the appropriate alternative.

(5) A company which contravenes paragraph (1), and any officer of it who is in default, is liable to a fine and, for continued contravention, to a daily default fine.

(6) A company which fails to comply with a direction by the Department under paragraph (2), and any officer of the company who is in default, is liable to a fine and, for continued contravention, to a daily default fine.

F67 Words in art. 41(2) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3)(a), 10(1), Sch. 4 para. 17(1) (with art. 12)

F68 Art. 41(2A)-(2C) inserted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3)(a), 10(1), Sch. 4 para. 17(1) (with art. 12)

Power to require company to abandon misleading name N.I.

42.—(1) If in the opinion of the Department the name by which a company is registered gives so misleading an indication of the nature of its activities as to be likely to cause harm to the public, the Department may direct it to change its name.

(2) The direction must, if not duly made the subject of an application to the court under paragraph (3), be complied with within a period of 6 weeks from the date of the direction or such longer period as the Department may think fit to allow.

(3) The company may, within a period of 3 weeks from the date of the direction, apply to the court to set it aside; and the court may set the direction aside or confirm it and, if it confirms the direction, shall specify a period within which it must be complied with.

(4) If a company makes default in complying with a direction under this Article, it is liable to a fine and, for continued contravention, to a daily default fine.

(5) Where a company changes its name under this Article, the registrar shall (subject to Article 36) enter the new name on the register in place of the former name, and shall issue a certificate of incorporation altered to meet the circumstances of the case; and the change of name has effect from the date on which the altered certificate is issued.

(6) A change of name by a company under this Article does not affect any of its rights or obligations or render defective any legal proceedings by or against it; and any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its new name.

Prohibition on trading under misleading name N.I.

43.—(1) A person who is not a public company is guilty of an offence if he carries on any trade, profession or business under a name which includes, as its last part, the words “public limited company” or any contraction or imitation of those words.

(2) A public company is guilty of an offence if, in circumstances in which the fact that it is a public company is likely to be material to any person, it uses a name which may reasonably be expected to give the impression that it is a private company.

(3) A person guilty of an offence under paragraph (1) or (2) and, if that person is a company, any officer of the company who is in default, is liable to a fine and, for continued contravention, to a daily default fine.

Penalty for improper use of “limited” N.I.

44.  If any person trades or carries on business under a name or title of which the word “limited”, or any contraction or imitation of that word, is the last word, that person, unless duly incorporated with limited liability, is liable to a fine and, for continued contravention, to a daily default fine.

[F69 Penalty for improper use of “community interest company” N.I.

44A.— (1) A company which is not a community interest company is guilty of an offence if it carries on any trade, profession or business under a name which includes any of the expressions specified in paragraph (3).

(2) A person other than a company is guilty of an offence if it carries on any trade, profession or business under a name which includes any of those expressions (or any contraction of them) as its last part.

(3) The expressions are—

(a) “community interest company”, and

(b) “community interest public limited company”.

(4) Paragraphs (1) and (2) do not apply—

(a) to a person who was carrying on a trade, profession or business under the name in question at any time during the period beginning with 1st January 2005 and ending with 15th March 2005, or

(b) if the name in question was on 15th March 2005 a registered trade mark or Community trade mark (within the meaning of the Trade Marks Act 1994), to a person who was on that date a proprietor or licensee of that trade mark.

(5) A person guilty of an offence under paragraph (1) or (2) and, if that person is a company, any officer of the company who is in default, is liable to a fine and, for continued contravention, to a daily default fine.]

F69 Art. 44A inserted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 51 (with art. 11(1))

{prosp. insertion of art. 44A by 2005 NI17} N.I.

F70 prosp. insertion by 2005 NI 17 (which amendment repealed (6.4.2007) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2)

CHAPTER IIIF1029 N.I. A COMPANY'S CAPACITY; FORMALITIES OF CARRYING ON BUSINESS

A company's capacity not limited by its memorandum N.I.

45.—(1) The validity of an act done by a company shall not be called into question on the ground of lack of capacity by reason of anything in the company's memorandum.

(2) A member of a company may bring proceedings to restrain the doing of an act which but for paragraph (1) would be beyond the company's capacity; but no such proceedings shall lie in respect of an act to be done in fulfilment of a legal obligation arising from a previous act of the company.

(3) It remains the duty of the directors to observe any limitations on their powers flowing from the company's memorandum; and action by the directors which but for paragraph (1) would be beyond the company's capacity may only be ratified by the company by special resolution.

A resolution ratifying such action shall not affect any liability incurred by the directors or any other person; relief from any such liability must be agreed to separately by special resolution.

(4) The operation of this Article is restricted by Article 9A of the Charities (Northern Ireland) Order 1987 in relation to companies which are charities; and Article 330A below (invalidity of certain transactions to which directors or their associates are parties) has effect notwithstanding this Article.

Modifications etc. (not altering text)

C3 Art. 45 restricted (prosp.) by Charities Act (Northern Ireland) 2008 (c. 12), ss. 97(1), 185(1)

Power of directors to bind the company N.I.

45A.—(1) In favour of a person dealing with a company in good faith, the power of the board of directors to bind the company, or authorise others to do so, shall be deemed to be free of any limitation under the company's constitution.

(2) For this purpose—

(a) a person “deals with” a company if he is a party to any transaction or other act to which the company is a party;

(b) a person shall not be regarded as acting in bad faith by reason only of his knowing that an act is beyond the powers of the directors under the company's constitution; and

(c) a person shall be presumed to have acted in good faith unless the contrary is proved.

(3) The references above to limitations on the directors' powers under the company's constitution include limitations deriving—

(a) from a resolution of the company in general meeting or a meeting of any class of shareholders, or

(b) from any agreement between the members of the company or of any class of shareholders.

(4) Paragraph (1) does not affect any right of a member of the company to bring proceedings to restrain the doing of an act which is beyond the powers of the directors; but no such proceedings shall lie in respect of an act to be done in fulfilment of a legal obligation arising from a previous act of the company.

(5) Nor does that paragraph affect any liability incurred by the directors, or any other person, by reason of the directors' exceeding their powers.

(6) The operation of this Article is restricted by Article 9A of the Charities (Northern Ireland) Order 1987 in relation to companies which are charities; and Article 330A below (invalidity of certain transactions to which directors or their associates are parties) has effect notwithstanding this Article.

Modifications etc. (not altering text)

C4 Art. 45A restricted (prosp.) by Charities Act (Northern Ireland) 2008 (c. 12), ss. 97(1), 185(1)

No duty to enquire as to capacity of company or authority of directors N.I.

45B.  A party to a transaction with a company is not bound to enquire as to whether it is permitted by the company's memorandum or as to any limitation on the powers of the board of directors to bind the company or authorise others to do so.

Form of company contracts N.I.

46 .F71   F72 A contract may be made—

(a) by a company, by writing under its common seal, or

(b) on behalf of a company, by any person acting under its authority, express or implied;

and any formalities required by law in the case of a contract made by an individual also apply, unless a contrary intention appears, to a contract made by or on behalf of a company.

F71 mod. by SR 2003/5

F72 mod. by SR 2004/307

Execution of documents N.I.

46A .F73 —(1) The following provisions have effect with respect to the execution of documents by a company.

(2) A document is executed by a company by the affixing of its common seal.

(3) A company need not have a common seal, however, and the following paragraphs apply whether it does or not.

(4 )F74  A document signed by a director and the secretary of a company, or by two directors of a company,[F75 or a liquidator of a company,] and expressed (in whatever form of words) to be executed by the company has the same effect as if executed under the common seal of the company.

(5) A document executed by a company which makes it clear on its face that it is intended by the person or persons making it to be a deed has effect, upon delivery, as a deed; and it shall be presumed, unless a contrary intention is proved, to be delivered upon its being so executed.

(6 )F74  In favour of a purchaser a document shall be deemed to have been duly executed by a company if it purports to be signed by a director and the secretary of the company, or by two directors of the company,[F75 or the liquidator of the company,] and, where it makes it clear on its face that it is intended by the person or persons making it to be a deed, to have been delivered upon its being executed.

A “purchaser” means a purchaser in good faith for valuable consideration and includes a lessee, mortgagee or other person who for valuable consideration acquires an interest in property.

F73 mod. by SR 2003/5

F74 mod. by SR 2004/307

F75 2005 NI 7

Pre-incorporation contracts and deeds N.I.

46B .F76 —(1) A contract which purports to be made by or on behalf of a company at a time when the company has not been formed has effect, subject to any agreement to the contrary, as one made with the person purporting to act for the company or as agent for it, and he is personally liable on the contract accordingly.

(2) Paragraph (1) applies to the making of a deed as it applies to the making of a contract.

F76 mod. by SR 2004/307

Bills of exchange and promissory notes N.I.

47 .F77   A bill of exchange or promissory note is deemed to have been made, accepted or endorsed on behalf of a company if made, accepted or endorsed in the name of, or by or on behalf or on account of, the company by a person acting under its authority.

F77 mod. by SR 2004/307

Execution of deeds abroad N.I.

48 .F78 —(1) A company may, by writing under its common seal, empower any person, either generally or in respect of any specified matters, as its attorney, to execute deeds on its behalf in any place elsewhere than in the United Kingdom.

[F79 (2) A deed executed by such an attorney on behalf of the company has the same effect as if it were executed under the company's common seal.]

F78 mod. by SR 2004/307

F79 1990 NI 10

Power of company to have official seal for use abroad N.I.

49.—(1 )F80  A company[F81 which has a common seal and] whose objects require or comprise the transaction of business in foreign countries may, if authorised by its articles, have for use in any territory, district, or place elsewhere than in the United Kingdom, an official seal, which shall be a facsimile of[F81 its common seal], with the addition on its face of the name of every territory, district or place where it is to be used.

[F81 (2) The official seal when duly affixed to a document has the same effect as the company's common seal.]

(3) A company having an official seal for use in any such territory, district or place may, by writing under its common seal, authorise any person appointed for the purpose in that territory, district or place to affix the official seal to any deed or other document to which the company is party in that territory, district or place.

(4) As between the company and a person dealing with such an agent, the agent's authority continues during the period (if any) mentioned in the instrument conferring the authority, or if no period is there mentioned, then until notice of the revocation or determination of the agent's authority has been given to the person dealing with him.

(5) The person affixing the official seal shall certify in writing on the deed or other instrument to which the seal is affixed the date on which and the place at which it is affixed.

F80 mod. by SR 2004/307

F81 1990 NI 10

Official seal for share certificates, etc. N.I.

50.  F82 A company[F83 which has a common seal] may have, for use for sealing securities issued by the company and for sealing documents creating or evidencing securities so issued, an official seal which is a facsimile of[F83 its common seal] with the addition on its face of the word “Securities”.[F83 The official seal when duly affixed to a document has the same effect as the company's common seal.]

F82 mod. by SR 1986/305

F83 1990 NI 10

Authentication of documents N.I.

51.  F84 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F84 Art. 51 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 4(2)(b) (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Events affecting a company's status N.I.

52.  F85 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F85 Art. 52 repealed (1.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(a), Sch. 2 Pt. 2 (with arts. 6, 8, Sch. 5)

PART IIIF1029 N.I. RE-REGISTRATION AS A MEANS OF ALTERING A COMPANY'S STATUS

Private company becoming publicF1029 N.I.

Re-registration of private company as public N.I.

53.—(1) Subject to this Article and Articles 54 to 58, a private company (other than a company not having a share capital) may be re-registered as a public company if—

(a) a special resolution that it should be so re-registered is passed; and

(b) an application for re-registration is delivered to the registrar, together with the necessary documents.

A company cannot be re-registered under this Article if it has previously been re-registered as unlimited.

(2) The special resolution must—

(a) alter the company's memorandum so that it states that the company is to be a public company; and

(b) make such other alterations in the memorandum as are necessary to bring it (in substance and in form) into conformity with the requirements of this Order with respect to the memorandum of a public company (the alterations to include compliance with Article 35(1)[F86 , or section 33 of the Companies (Audit, Investigations and Community Enterprise) Act 2004,] as regards the company's name); and

(c) make such alterations in the company's articles as are requisite in the circumstances.

(3) The application must be in the prescribed form and be signed by a director or secretary of the company; and the documents to be delivered with it are the following—

(a) a printed copy of the memorandum and articles as altered in pursuance of the resolution;

(b) a copy of a written statement by the company's auditors that in their opinion the relevant balance sheet shows that at the balance sheet date the amount of the company's net assets (within the meaning given to that expression by Article 272(2)) was not less than the aggregate of its called-up share capital and undistributable reserves;

(c) a copy of the relevant balance sheet, together with a copy of an unqualified report (as defined in Article 56) by the company's auditors in relation to that balance sheet;

(d) if Article 54 applies, a copy of the valuation report under paragraph (2)(b) of that Article; and

(e) [F87 subject to paragraph (3A),] a statutory declaration in the prescribed form by a director or secretary of the company—

(i) that the special resolution required by this Article has been passed and that the conditions of Articles 54 and 55 (so far as applicable) have been satisfied, and

(ii) that, between the balance sheet date and the application for re-registration, there has been no change in the company's financial position that has resulted in the amount of its net assets becoming less than the aggregate of its called-up share capital and undistributable reserves.

[F87 (3A) In place of the statutory declaration referred to in sub-paragraph (e) of paragraph (3), there may be delivered to the registrar using electronic communications a statement made by a director or secretary of the company as to the matters set out in heads (i) and (ii) of that sub-paragraph.

(3B) Any person who makes a false statement under paragraph (3A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

(4) In this Article and Articles 54 and 56, “relevant balance sheet” means a balance sheet prepared as at a date not more than 7 months before the company's application under this Article.

(5) A resolution that a company be re-registered as a public company may change the company name by deleting the word “company” or the words “and company”, including any abbreviation of them.

F86 Words in art. 53(2)(b) inserted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 52 (with art. 11(1))

F87 SR 2003/3

Consideration for shares recently allotted to be valued N.I.

54.—(1) This Article applies if shares have been allotted by the company between the relevant balance sheet date and the passing of the special resolution under Article 53, and those shares were allotted as fully or partly paid up as to their nominal value or any premium on them otherwise than in cash.

(2) Subject to the following provisions of this Article, the registrar shall not entertain an application by the company under Article 53 unless beforehand—

(a) the consideration for the allotment has been valued in accordance with Article 118, and

(b) a report with respect to the value of the consideration has been made to the company (in accordance with that Article) during the 6 months immediately preceding the allotment of the shares.

(3) Where an amount standing to the credit of any of the company's reserve accounts, or of its profit and loss account, has been applied in paying up (to any extent) any of the shares allotted to members of the company or any premium on those shares, the amount applied does not count as consideration for the allotment, and accordingly paragraph (2) does not apply to it.

(4) Paragraph (2) does not apply if the allotment is in connection with an arrangement providing for it to be on terms that the whole or part of the consideration for the shares allotted is to be provided by the transfer to the company or the cancellation of all or some of the shares, or of all or some of the shares of a particular class, in another company (with or without the issue to the company applying under Article 53 of shares, or of shares of any particular class, in that other company).

(5) But paragraph (4) does not exclude the application of paragraph (2), unless under the arrangement it is open to all the holders of the shares in the other company in question (or, where the arrangement applies only to shares of a particular class, to all the holders of the other company's shares of that class) to take part in the arrangement.

In determining whether that is the case, shares held by or by a nominee of the company allotting shares in connection with the arrangement, or by or by a nominee of a company which is that company's holding company or subsidiary or a company which is a subsidiary of its holding company, are to be disregarded.

(6) Paragraph (2) does not apply to preclude an application under Article 53, if the allotment of the company's shares is in connection with its proposed merger with another company; that is, where one of the companies concerned proposes to acquire all the assets and liabilities of the other in exchange for the issue of shares or other securities in that one to shareholders of the other, with or without any cash payment to those shareholders.

(7) In this Article—

(a) “arrangement” means any agreement, scheme or arrangement, including an arrangement sanctioned in accordance with Article 418 (company compromise with creditors and members) or[F88 Article 96 of the Insolvency Order] (liquidator in winding up accepting shares as consideration for sale of a company's property), and

(b) “another company” includes any body corporate and any body to which letters patent have been issued under the [1837 c. 73] Chartered Companies Act 1837.

F88 1989 NI 19

Additional requirements relating to share capital N.I.

55.—(1) For a private company to be re-registered under Article 53 as a public company, the following conditions with respect to its share capital must be satisfied at the time the special resolution under that Article is passed.

(2) Subject to paragraphs (5) to (7)—

(a) the nominal value of the company's allotted share capital must be not less than the authorised minimum, and

(b) each of the company's allotted shares must be paid up at least as to one-quarter of the nominal value of that share and the whole of any premium on it.

(3) Subject to paragraph (5), if any shares in the company or any premium payable on them have been fully or partly paid up by an undertaking given by any person that he or another should do work or perform services (whether for the company or any other person), the undertaking must have been performed or otherwise discharged.

(4) Subject to paragraph (5), if shares have been allotted as fully or partly paid up as to their nominal value or any premium payable on them otherwise than in cash and the consideration for the allotment consists of or includes an undertaking (other than one to which paragraph (3) applies) to the company, then either—

(a) the undertaking must have been performed or otherwise discharged, or

(b) there must be a contract between the company and some person pursuant to which the undertaking is to be performed within 5 years from the time the special resolution under Article 53 is passed.

(5) For the purpose of determining whether paragraphs (2)(b), (3) and (4) are complied with, certain shares in the company may be disregarded; and these are—

(a) subject to paragraph (6), any share which was allotted on or before 31st December 1984, or

(b) any share which was allotted in pursuance of an employees' share scheme and by reason of which the company would, but for this paragraph, be precluded under paragraph (2)(b) (but not otherwise) from being re-registered as a public company.

(6) A share is not be disregarded under paragraph (5)(a) if the aggregate in nominal value of that share and other shares proposed to be so disregarded is more than one-tenth of the nominal value of the company's allotted share capital; but for this purpose the allotted share capital is treated as not including any shares disregarded under paragraph (5)(b).

(7) Any shares disregarded under paragraph (5) are treated as not forming part of the allotted share capital for the purposes of paragraph (2)(a).

Meaning of “unqualified report” in Article 53(3) N.I.

56.—(1) The following paragraphs explain the reference in Article 53(3)(c) to an unqualified report of the company's auditors on the relevant balance sheet.

[F89 (2) If the balance sheet was prepared for a financial year of the company, the reference is to an auditors' report stating without material qualification the auditors' opinion that the balance sheet has been properly prepared in accordance with this Order.

(3) If the balance sheet was not prepared for a financial year of the company, the reference is to an auditors' report stating without material qualification the auditors' opinion that the balance sheet has been properly prepared in accordance with the provisions of this Order which would have applied if it had been so prepared.

For the purposes of an auditors' report under this paragraph the provisions of this Order shall be deemed to apply with such modifications as are necessary by reason of the fact that the balance sheet is not prepared for a financial year of the company.

(4) A qualification shall be regarded as material unless the auditors state in their report that the matter giving rise to the qualification is not material for the purpose of determining (by reference to the company's balance sheet) whether at the balance sheet date the amount of the company's net assets was not less than the aggregate of its called up share capital and undistributable reserves.

In this paragraph “net assets” and “undistributable reserves” have the meaning given by Article 272(2) and (3).]

F89 1990 NI 5

Certificate of re-registration under Article 53 N.I.

57.—(1) If the registrar is satisfied, on an application under Article 53, that a company may be re-registered under that Article as a public company, he shall—

(a) retain the application and other documents delivered to him under that Article; and

(b) issue the company with a certificate of incorporation stating that the company is a public company.

(2) The registrar may accept a declaration under Article 53(3)(e)[F90 or a statement under Article 53(3A)] as sufficient evidence that the special resolution required by that Article has been passed and the other conditions of re-registration have been satisfied.

(3) The registrar shall not issue a certificate of incorporation if it appears to him that the court has made an order confirming a reduction of the company's capital which has the effect of bringing the nominal value of the company's allotted share capital below the authorised minimum.

(4) Upon the issue to a company of a certificate of incorporation under this Article—

(a) the company by virtue of the issue of that certificate becomes a public company; and

(b) any alterations in the memorandum and articles of association set out in the resolution take effect accordingly.

(5) A certificate of incorporation is conclusive evidence—

(a) that the requirements of this Order in respect of re-registration and of matters precedent and incidental thereto have been complied with; and

(b) that the company is a public company.

F90 SR 2003/3

Modification for unlimited company re-registering N.I.

58.—(1) In their application to unlimited companies, Articles 53 to 57 are modified as follows.

(2) The special resolution required by paragraph (1) of Article 53 must, in addition to the matters mentioned in paragraph (2) of that Article—

(a) state that the liability of the members is to be limited by shares, and what the company's share capital is to be; and

(b) make such alterations in the company's memorandum as are necessary to bring it in substance and in form into conformity with the requirements of this Order with respect to the memorandum of a company limited by shares.

(3) The certificate of incorporation issued under paragraph (1) of Article 57 shall, in addition to containing the statement required by sub-paragraph (b) of that paragraph, state that the company has been incorporated as a company limited by shares; and—

(a) the company by virtue of the issue of the certificate becomes a public company so limited; and

(b) the certificate is conclusive evidence of the fact that it is such a company.

Limited company becoming unlimitedF1029 N.I.

Re-registration of limited company as unlimited N.I.

59.—(1) Subject as follows, a company which is registered as limited may be re-registered as unlimited in pursuance of an application in that behalf complying with the requirements of this Article.

(2) A company is excluded from re-registering under this Article if it is limited by virtue or re-registration under Article 119 of the Order of 1978 or Article 61 of this Order.

(3) A public company cannot be re-registered under this Article; nor can a company which has previously been re-registered as unlimited.

(4) An application under this Article must be in the prescribed form and be signed by a director or the secretary of the company, and be lodged with the registrar, together with the documents specified in paragraph (8).

(5) The application must set out such alterations in the company's memorandum as—

(a) if it is to have a share capital, are requisite to bring it (in substance and in form) into conformity with the requirements of this Order with respect to the memorandum of a company to be formed as an unlimited company having a share capital; or

(b) if it is not to have a share capital, are requisite in the circumstances.

(6) If articles of association have been registered, the application must set out such alterations in them as—

(a) if the company is to have a share capital, are requisite to bring its articles (in substance and in form) into conformity with the requirements of this Order with respect to the articles of a company to be formed as an unlimited company having a share capital; or

(b) if the company is not to have a share capital, are requisite in the circumstances.

(7) If articles of association have not been registered, the application must have annexed to it, and request the registration of, printed articles; and these must, if the company is to have a share capital, comply with the requirements mentioned in paragraph (6)(a) and, if not, be articles appropriate to the circumstances.

(8) The documents to be lodged with the registrar are—

(a) the prescribed form of assent to the company's being registered as unlimited, subscribed by or on behalf of all the members of the company;

(b) [F91 subject to paragraph (8A),] a statutory declaration made by the directors of the company—

(i) that the persons by whom or on whose behalf the form of assent is subscribed constitute the whole membership of the company, and

(ii) that if any of the members have not subscribed that form themselves, that the directors have taken all reasonable steps to satisfy themselves that each person who subscribed it on behalf of a member was lawfully empowered to do so;

(c) a printed copy of the memorandum incorporating the alterations in it set out in the application; and

(d) if articles of association have been registered, a printed copy of them incorporating the alterations set out in the application.

[F91 (8A) In place of the lodging of a statutory declaration under sub-paragraph (b) of paragraph (8), there may be delivered to the registrar using electronic communications a statement made by the directors of the company as to the matters set out in heads (i) and (ii) of that sub-paragraph.

(8B) Any person who makes a false statement under paragraph (8A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

(9) For the purposes of this Article—

(a) subscription to a form of assent by the personal representative of a deceased member of a company is deemed a subscription by him; and

(b) the assignees or trustee in bankruptcy of a member of a company is, to the exclusion of that member, deemed a member of the company.

F91 SR 2003/3

Certificate of re-registration under Article 59 N.I.

60.—(1) The registrar shall retain the application and other documents lodged with him under Article 59 and shall—

(a) if articles of association are annexed to the application, register them; and

(b) issue to the company a certificate of incorporation appropriate to the status to be assumed by it by virtue of that Article.

(2) On the issue of the certificate—

(a) the status of the company, by virtue of the issue, is changed from limited to unlimited; and

(b) the alterations in the memorandum set out in the application and (if articles of association have been previously registered) any alterations to the articles so set out take effect as if duly made by resolution of the company; and

(c) the provision of this Order apply accordingly to the memorandum and articles as altered by virtue of Article 59.

(3) The certificate is conclusive evidence that the requirements of Article 59 in respect of re-registration and of matters precedent and incidental to it have been complied with, and that the company was authorised to be re-registered under this Order in pursuance of that Article and was duly so re-registered.

Unlimited company becoming limitedF1029 N.I.

Re-registration of unlimited company as limited N.I.

61.—(1) Subject as follows, a company which is registered as unlimited may be re-registered as limited if a special resolution that it should be so re-registered is passed, and the requirements of this Article are complied with in respect of the resolution and otherwise.

(2) A company cannot under this Article be re-registered as a public company; and a company is excluded from re-registering under it if it is unlimited by virtue of re-registration under Article 118 of the Order of 1978 or Article 59 or this Order.

(3) The special resolution must state whether the company is to be limited by shares or by guarantee and—

(a) if it is to be limited by shares, must state what the share capital is to be and provide for the making of such alterations in the memorandum as are necessary to bring it (in substance and in form) into conformity with the requirements of this Order with respect to the memorandum of a company so limited, and such alterations in the articles of association as are requisite in the circumstances;

(b) if it is to be limited by guarantee, must provide for the making of such alterations in its memorandum and articles as are necessary to bring them (in substance and in form) into conformity with the requirements of this Order with respect to the memorandum and articles of a company so limited.

(4) F92 . . . an application for the company to be re-registered as limited, framed in the prescribed form and signed by a director or by the secretary of the company, must be lodged with the registrar, together with the necessary documents, not earlier than the day on which the copy of the resolution forwarded [F93 under section 30 of the Companies Act 2006] is received by him.

(5) The documents to be lodged with the registrar are—

(a) a printed copy of the memorandum as altered in pursuance of the resolution; and

(b) a printed copy of the articles as so altered.

(6) This Article does not apply in relation to the re-registration of an unlimited company as a public company under Article 53.

F92 Words in art. 61(4) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3)(a), 10(1), Sch. 4 para. 17(2)(a) (with art. 12)

F93 Words in art. 61(4) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3)(a), 10(1), Sch. 4 para. 17(2)(b) (with arts. 12)

Certificate of re-registration under Article 61 N.I.

62.—(1) The registrar shall retain the application and other documents lodged with him under Article 61, and shall issue to the company a certificate of incorporation appropriate to the status to be assumed by the company by virtue of that Article.

(2) On the issue of the certificate—

(a) the status of the company is, by virtue of the issue, changed from unlimited to limited; and

(b) the alterations in the memorandum specified in the resolution and the alterations in, and additions to, the articles so specified take effect.

(3) The certificate is conclusive evidence that the requirements of Article 61 in respect of re-registration and of matters precedent and incidental to it have been complied with, and that the company was authorised to be re-registered in pursuance of that Article and was duly so re-registered.

Public company becoming privateF1029 N.I.

Re-registration of public company as private N.I.

63.—(1) A public company may be re-registered as a private company if—

(a) a special resolution complying with paragraph (2) that it should be so re-registered is passed and has not been cancelled by the court under Article 64;

(b) an application for the purpose in the prescribed form and signed by a director or the secretary of the company is delivered to the registrar, together with a printed copy of the memorandum and articles of the company as altered by the resolution; and

(c) the period during which an application for the cancellation of the resolution under Article 64 may be made has expired without any such application having been made; or

(d) where such an application has been made, the application has been withdrawn or an order has been made under Article 64(5) confirming the resolution and a copy of that order has been delivered to the registrar.

(2) The special resolution must alter the company's memorandum so that it no longer states that the company is to be a public company and must make such other alterations in the company's memorandum and articles as are requisite in the circumstances.

(3) A company cannot under this Article be re-registered otherwise than as a company limited by shares or by guarantee.

Litigation objection to resolution under Article 63 N.I.

64.—(1) Where a special resolution by a public company to be re-registered under Article 63 as a private company has been passed, an application may be made to the court for the cancellation of that resolution.

(2) The application may be made—

(a) by the holders of not less in the aggregate than 5 per cent. in nominal value of the company's issued share capital or any class thereof;

(b) if the company is not limited by shares, by not less than 5 per cent. of its members; or

(c) by not less than 50 of its members;

but not by a person who has consented to or voted in favour of the resolution.

[F94 (2A) For the purposes of paragraph (2)(a), any of the company's issued share capital held as treasury shares must be disregarded.]

(3) The application must be made within 28 days after the passing of the resolution and may be made on behalf of the persons entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.

(4) If such an application is made, the company shall forthwith give notice in the prescribed form of that fact to the registrar.

(5) On the hearing of the application, the court shall make an order either cancelling or confirming the resolution and—

(a) may make that order on such terms and conditions as it thinks fit, and may (if it thinks fit) adjourn the proceedings in order that an arrangement may be made to the satisfaction of the court for the purchase of the interests of dissentient members; and

(b) may give such directions and make such orders as it thinks expedient for facilitating or carrying into effect any such arrangement.

(6) The court's order may, if the court thinks fit, provide for the purchase by the company of the shares of any of its members and for the reduction accordingly of the company's capital, and may make such alterations in the company's memorandum and articles as may be required in consequence of that provision.

(7) The company shall, within 15 days from the making of the court's order, or within such longer period as the court may at any time by order direct, deliver to the registrar an office copy of the order.

(8) If the court's order requires the company not to make any, or any specified, alteration in its memorandum or articles, the company has not then power without the leave of the court to make any such alteration in breach of that requirement.

(9) An alteration in the memorandum or articles made by virtue of an order under this Article, if not made by resolution of the company, is of the same effect as if duly made by resolution; and this Order applies accordingly to the memorandum or articles as so altered.

(10) A company which fails to comply with paragraph (4) or paragraph (7), and any officer of it who is in default, is liable to a fine and, for continued contravention, to a daily default fine.

F94 SR 2004/275

Certificate of re-registration under Article 63 N.I.

65.—(1) If the registrar is satisfied that a company may be re-registered under Article 63, he shall—

(a) retain the application and other documents delivered to him under that Article; and

(b) issue the company with a certificate of incorporation appropriate to a private company.

(2) On the issue of the certificate—

(a) the company by virtue of the issue becomes a private company; and

(b) the alterations in the memorandum and articles set out in the resolution under Article 63 take effect accordingly.

(3) The certificate is conclusive evidence—

(a) that the requirements of Article 63 in respect of re-registration and of matters precedent and incidental to it have been complied with; and

(b) that the company is a private company.

F95 PART IVF1029 N.I. CAPITAL ISSUES

F95 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

CHAPTER IF1029 N.I. ISSUES BY COMPANIES REGISTERED, OR TO BE REGISTERED, IN NORTHERN IRELAND

The prospectusF1029 N.I.

F96 Matters to be stated, and reports to be set out, in prospectus N.I.

66.—(1) Every prospectus issued by or on behalf of a company, or by or on behalf of any person who is or has been engaged or interested in the formation of the company, must comply—

(a) with Part I of Schedule 3, as respects the matters to be stated in the prospectus, and

(b) with Part II of that Schedule, as respects the reports to be set out.

(2) It is unlawful to issue any form of application for shares in or debentures of a company unless the form is issued with a prospectus which complies with the requirements of this Article.

(3) Paragraph (2) does not apply if it is shown that the form of application was issued either—

(a) in connection with a bona fide invitation to a person to enter into an underwriting agreement with respect to the shares or debentures, or

(b) in relation to shares or debentures which were not offered to the public.

(4) If a person acts in contravention of paragraph (2), he is liable to a fine.

(5) This Article does not apply—

(a) to the issue to existing members or debenture holders of a company of a prospectus or form of application relating to shares in or debentures of the company, whether an applicant for shares or debentures will or will not have the right to renounce in favour of other persons, or

(b) to the issue of a prospectus or form of application relating to shares or debentures which are or are to be in all respects uniform with shares or debentures previously issued and for the time being listed on a prescribed stock exchange;

but subject to this, it applies to a prospectus or a form of application whether issued on or with reference to the formation of a company or subsequently.

F96 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F97 Attempted evasion of Article 66 to be void N.I.

67.  A condition requiring or binding an applicant for shares in or debentures of a company to waive compliance with any requirement of Article 66, or purporting to affect him with notice of any contract, document or matter not specifically referred to in the prospectus, is void.

F97 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F98 Document offering shares, etc. for sale deemed a prospectus N.I.

68.—(1) If a company allots or agrees to allot its shares or debentures with a view to all or any of them being offered for sale to the public, any document by which the offer for sale to the public is made is deemed for all purposes a prospectus issued by the company.

(2) All statutory provisions and rules of law as to the contents of prospectuses, and to liability in respect of statements in and omissions from prospectuses, or otherwise relating to prospectuses, apply and have effect accordingly, as if the shares or debentures had been offered to the public for subscription and as if person accepting the offer in respect of any shares or debentures were subscribers for those shares or debentures.

This is without prejudice to the liability (if any) of the persons by whom the offer is made, in respect of mis-statements in the document or otherwise in respect of it.

(3) For the purposes of this Order it is evidence (unless the contrary is proved) that an allotment of, or an agreement to allot, shares or debentures was made with a view to their being offered for sale to the public if it is shown—

(a) that an offer of the shares or debentures (or of any of them) for sale to the public was made within 6 months after the allotment or agreement to allot, or

(b) that at the date when the offer was made the whole consideration to be received by the company in respect of the shares or debentures had not been so received.

(4) Article 66 as applied by this Article has effect as if it required a prospectus to state, in addition to the matters required by that Article—

(a) the net amount of the consideration received or to be received by the company in respect of the shares or debentures to which the offer relates, and

(b) the place and time at which the contract under which those shares or debentures have been or are to be allotted may be inspected.

F98 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

Arts. 69, 70 rep. by SI 2001/3649

F99 Prospectus containing statement by expert N.I.

71.—(1) A prospectus inviting persons to subscribe for a company's shares or debentures and including a statement purporting to be made by an expert shall not be issued unless—

(a) he (the expert) has given and has not, before delivery of a copy of the prospectus for registration, withdrawn his written consent to its issue with the statement included in the form and context in which it is in fact included; and

(b) a statement that he has given and not withdrawn that consent appears in the prospectus.

(2) If a prospectus is issued in contravention of this Article the company and every person who is knowingly a party to the issue of the prospectus is liable to a fine.

F99 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F100 Meaning of “expert” N.I.

72.  In this Part, “expert” includes engineer, valuer, accountant and any other person whose profession gives authority to a statement made by him.

F100 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F101 Prospectus to be dated N.I.

73.  A prospectus issued by or on behalf of a company, or in relation to an intended company, shall be dated; and that date shall, unless the contrary is proved, be taken as its date of publication.

F101 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

Registration of prospectusF1029 N.I.

F102 Registration requirement applicable in all cases N.I.

74.—(1) No prospectus shall be issued by or on behalf of a company, or in relation to an intended company, unless on or before the date of its publication there has been delivered to the registrar for registration a copy of the prospectus—

(a) signed by every person who is named in it as a director or proposed director of the company, or by his agent authorised in writing, and

(b) having endorsed on or attached to it any consent to its issue required by Article 71 from any person as an expert.

(2) Where the prospectus is such a document as is referred to in Article 68, the signatures required by paragraph (1) include those of every person making the offer, or his agent authorised in writing.

Where the offer is made by a company or a firm, it is sufficient for the purposes of this paragraph if the document is signed on its behalf by 2 directors or (as the case may be) not less than half of the partners; and a director or partner may sign by his agent authorised in writing.

(3) Every prospectus shall on its face—

(a) state that a copy has been delivered for registration as required by this Article, and

(b) specify, or refer to statements in the prospectus specifying, any documents required by this Article or Article 75 to be endorsed on or attached to the copy delivered.

(4) The registrar shall not register a prospectus unless it is dated and the copy of it signed as required by this Article and unless it has endorsed on or attached to it the documents (if any) specified in paragraph (3)(b).

(5) If a prospectus is issued without a copy of it being delivered to the registrar as required by this Article, or without the copy so delivered having the required documents endorsed on or attached to it, the company and every person who is knowingly a party to the issue of the prospectus is liable to a fine and, for continued contravention, to a daily default fine.

F102 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F103 Additional requirements in case of prospectus issued generally N.I.

75.—(1) In the case of a prospectus issued generally the following provisions apply in addition to those of Article 74.

(2) The copy of the prospectus delivered to the registrar must also have endorsed on or attached to it a copy of any contract required by paragraph 11 of Schedule 3 to be stated in the prospectus or, in the case of a contract not reduced into writing, a memorandum giving full particulars of it.

(3) In the case of a contract wholly or partly in a foreign language—

(a) the copy required by paragraph (2) to be endorsed on or attached to the prospectus must be a copy of a translation of the contract into English or (as the case may be) a copy embodying a translation into English of the parts in a foreign language, and

(b) the translation must be certified in the prescribed manner to be a correct translation.

(4) If the person making any report required by Part II of Schedule 3 have made in the report, or have (without giving reasons) indicated in it, any such adjustments as are mentioned in paragraph 21 of that Schedule (profits, losses, assets, liabilities), the copy of the prospectus delivered to the registrar must have endorsed on or attached to it a written statement signed by those persons setting out the adjustments and giving the reasons for them.

F103 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

Liabilities and offences in connection with prospectusF1029 N.I.

F104 Directors, etc. exempt from liability in certain cases N.I.

76.—(1) In the event of contravention of Article 66, a director or other person responsible for the prospectus does not incur any liability by reason of that contravention if—

(a) as regards any matter not disclosed, he proves that he was not cognisant of it, or

(b) he proves that the contravention arose from an honest mistake of fact on his part, or

(c) the contravention was in respect of matters which, in the opinion of the court dealing with the case, were immaterial or was otherwise such as ought (in the court's opinion, having regard to all the circumstances of the case) reasonably to be excused.

(2) In the event of failure to include in a prospectus a statement with respect to the matters specified in paragraph 13 of Schedule 3 (disclosure of directors' interests), no director or other person incurs any liability in respect of the failure unless it is proved that he had knowledge of the matters not disclosed.

(3) Nothing in Article 66 or 67 or this Article limits or diminishes any liability which a person may incur under the general law or this Order apart from those provisions.

F104 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F105 Compensation for subscribers misled by statement in prospectus N.I.

77.—(1) Where a prospectus invites persons to subscribe for a company's shares or debentures, compensation is payable to all those who subscribe for any shares or debentures on the faith of the prospectus for the loss or damage which they may have sustained by reason of any untrue statement included in it.

(2) The persons liable to pay the compensation are—

(a) every person who is a director of the company at the time of the issue of the prospectus,

(b) every person who authorised himself to be named, and is named, in the prospectus as a director or as having agreed to become a director (either immediately or after an interval of time),

(c) every person being a promoter of the company, and

(d) every person who has authorised the issue of the prospectus.

(3) Paragraphs (1) and (2) have effect subject to Articles 78 and 79; and here and in those Articles “promoter” means a promoter who was party to the preparation of the prospectus, or of the portion of it containing the untrue statement, but does not include any person by reason of his acting in a professional capacity for persons engaged in procuring the formation of the company.

F105 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F106 Exemption from Article 77 for those acting with propriety N.I.

78.—(1) A person is not liable under Article 77 if he proves—

(a) that, having consented to become a director of the company, he withdrew his consent before the issue of the prospectus, and that it was issued without his authority or consent, or

(b) that the prospectus was issued without his knowledge or consent, and that on becoming aware of its issue he forthwith gave reasonable public notice that it was issued without his knowledge or consent, or

(c) that after issue of the prospectus and before allotment under it he, on becoming aware of any untrue statement in it, withdrew his consent to its issue and gave reasonable public notice of the withdrawal and of the reason for it.

(2) A person is not liable under that Article if he proves that—

(a) as regards every untrue statement nor purporting to be made on the authority of an expert or of a public official document or statement, he had reasonable ground to believe, and did up to the time of the allotment of the shares or debentures (as the case may be) believe, that the statement was true; and

(b) as regards every untrue statement purporting to be a statement by an expert or contained in what purports to be a copy of or extract from a report or valuation of an expert, it fairly represented the statement, or was a correct and fair copy of or extract from the report or valuation, and he had reasonable ground to believe and did up to the time of issue of the prospectus believe that the person making the statement was competent to make it and that person had given the consent required by Article 71 to the issue of the prospectus and had not withdrawn that consent before delivery of a copy of the prospectus for registration or, to the defendant's knowledge, before allotment under it; and

(c) as regards every untrue statement purporting to be made by an official person or contained in what purports to be a copy of or extract from a public official document, it was a correct and fair representation of the statement or copy of or extract from the document.

(3) Paragraphs (1) and (2) do not apply in the case of a person liable, by reason of his having given a consent required of him by Article 71, as a person who has authorised the issue of the prospectus in respect of an untrue statement purporting to be made by him as an expert.

(4) Where under Article 71 the consent of a person is required to the issue of a prospectus and he has given that consent, he is not by reason of his having given it liable under Article 77 as a person who has authorised the issue of the prospectus except in respect of an untrue statement purporting to be made by him as an expert.

(5) A person who, apart from this paragraph, would under Article 77 be liable, by reason of his having given a consent required of him by Article 71, as a person who has authorised the issue of a prospectus in respect of an untrue statement purporting to be made by him as an expert is not so liable if he proves—

(a) that, having given his consent under Article 71 to the issue of the prospectus, he withdrew it in writing before the delivery of a copy of the prospectus for registration; or

(b) that, after delivery of a copy of the prospectus for registration and before allotment under it, he, on becoming aware of the untrue statement, withdrew his consent in writing and gave reasonable public notice of the withdrawal and of the reason for it; or

(c) that he was competent to make the statement and that he had reasonable ground to believe, and did up to the time of the allotment of the shares or debentures (as the case may be) believe, that the statement was true.

F106 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F107 Indemnity for innocent director or expert N.I.

79.—(1) This Article applies where—

(a) the prospectus contains the name of a person as a director of the company, or as having agreed to become a director of it, and he has not consented to become a director, or has withdrawn his consent before the issue of the prospectus, and has not authorised or consented to its issue, or

(b) the consent of a person is required under Article 71 to the issue of the prospectus and he either has not given that consent or has withdrawn it before the issue of the prospectus.

(2) The directors of the company (except any without whose knowledge or consent the prospectus was issued) and any other person who authorised its issue are liable to indemnify the person named, or whose consent was required under Article 71 (as the case may be), against all damages, costs and expenses to which he may be liable by reason of his name having been inserted in the prospectus or of the inclusion in it of a statement purporting to be made by him as an expert (as the case may be), or in defending himself against any action or legal proceeding brought against him in respect of it.

(3) A person is not deemed for the purposes of this Article to have authorised the issue of a prospectus by reason only of his having given the consent required by Article 71 to the inclusion of a statement purporting to be made by him as an expert.

F107 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F108 Criminal liability for untrue statements N.I.

80.—(1) If a prospectus is issued with an untrue statement included in it, any person who authorised the issue of the prospectus is guilty of an offence and liable to imprisonment or a fine, or both, unless he proves either—

(a) that the statement was immaterial, or

(b) that he had reasonable ground to believe and did, up to the time of the issue of the prospectus, believe that the statement was true.

(2) A person is not deemed for the purpose of this Article to have authorised the issue of a prospectus by reason only of his having given the consent required by Article 71 to the inclusion in it of a statement purporting to be made by him as an expert.

F108 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

SupplementaryF1029 N.I.

F109 Interpretation for Articles 66 to 80 N.I.

81.  For the purposes of Articles 66 to 80—

(a) a statement included in a prospectus is deemed to be untrue if it is misleading in the form and context in which it is included, and

(b) a statement is deemed to be included in a prospectus if it is contained in it, or in any report or memorandum appearing on its face, or by reference incorporated in, or issued with, the prospectus.

F109 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

CHAPTER IIF1029 N.I. ISSUES BY COMPANIES INCORPORATED, OR TO BE INCORPORATED, OUTSIDE THE UNITED KINGDOM

F110 Prospectus of non-United Kingdom company N.I.

82.—(1) It is unlawful for a person to issue, circulate or distribute in Northern Ireland any prospectus offering for subscription shares in or debentures of a company incorporated or to be incorporated outside the United Kingdom (whether the company has or has not established, or when formed will or will not establish, a place of business in the United Kingdom) unless the prospectus complies with the requirements of paragraphs (2) and (3).

(2) The prospectus must be dated and contain particulars with respect to the following matters—

(a) the instrument constituting or defining the constitution of the company;

(b) the enactments, or provisions having the force of an enactment, by or under which the incorporation of the company was effected;

(c) an address in the United Kingdom where that instrument, and those enactments or provisions, or copies of them (and, if they are in a foreign language, a translation of them certified in the prescribed manner), can be inspected;

(d) the date on which, and the country in which, the company was incorporated; and

(e) whether the company has established a place of business in the United Kingdom and, if so, the address of its principal office in the United Kingdom.

(3) Subject to the following provisions, the prospectus must comply—

(a) with Part I of Schedule 3, as respects the matters to be stated in the prospectus, and

(b) with Part II of that Schedule, as respects the reports to be set out.

(4) Sub-paragraphs (a) to (c) of paragraph (2) do not apply in the case of a prospectus issued more than 2 years after the company is entitled to commence business.

(5) It is unlawful for a person to issue to any person in Northern Ireland a form of application for shares in or debentures of such a company or intended company as is mentioned in paragraph (1) unless the form is issued with a prospectus which complies with this Chapter and the issue of which in Northern Ireland does not contravene Article 84 or 85.

This paragraph does not apply if it is shown that the form of application was issued in connection with a bona fide invitation to a person to enter into an underwriting agreement with respect to the shares or debentures.

(6) This Article—

(a) does not apply to the issue to a company's existing members or debenture holders of a prospectus or form of application relating to shares in or debentures of the company, whether an applicant for shares or debentures will or will not have the right to renounce in favour of other persons; and

(b) except in so far as it requires a prospectus to be dated, does not apply to the issue of a prospectus relating to shares or debentures which are or are to be in all respects uniform with shares or debentures previously issued and for the time being listed on a prescribed stock exchange;

but subject to this, it applies to a prospectus or form of application whether issued on or with reference to the formation of a company or subsequently.

F110 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F111 Attempted evasion of Article 82 to be void N.I.

83.  A condition requiring or binding an applicant for shares or debentures to waive compliance with any requirement imposed—

(a) by paragraph (2) of Article 82, as regards the particulars to be contained in the prospectus, or

(b) by paragraph (3) of that Article, as regards compliance with Schedule 3,

or purporting to affect an applicant with notice of any contract, document or matter not specifically referred to in the prospectus, is void.

F111 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F112 Prospectus containing statement by expert N.I.

84.—(1) This Article applies in the case of a prospectus offering for subscription shares in or debentures of a company incorporated or to be incorporated outside the United Kingdom (whether it has or has not established, or when formed will or will not establish, a place of business in the United Kingdom), if the prospectus includes a statement purporting to be made by an expert.

(2) It is unlawful for any person to issue, circulate or distribute in Northern Ireland such a prospectus if—

(a) the expert has not given, or has before the delivery of the prospectus for registration withdrawn, his written consent to the issue of the prospectus with the statement included in the form and context in which it is included; or

(b) there does not appear in the prospectus a statement that he has given and has not withdrawn his consent as mentioned in sub-paragraph (a).

(3) For the purposes of this Article, a statement is deemed to be included in a prospectus if it is contained in it, or in any report or memorandum appearing on its face, or by reference incorporated in, or issued with, the prospectus.

F112 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F113 Restrictions on allotment to be secured in prospectus N.I.

85.—(1) It is unlawful for a person to issue, circulate or distribute in Northern Ireland a prospectus offering for subscription shares in or debentures of a company incorporated or to be incorporated outside the United Kingdom (whether the company has or has not established, or when formed will or will not establish, a place of business in the United Kingdom), unless the prospectus complies with the following condition.

(2) The prospectus must have the effect, where an application is made in pursuance of it, of rendering all persons concerned bound by all the provisions (other than penal provisions) of Articles 92, 96 and 97 (restrictions on allotment), so far as applicable.

F113 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F114 Stock exchange certificate exempting from compliance with Schedule 3 N.I.

86.—(1) This Article applies where—

(a) it is proposed to offer to the public by a prospectus issued generally any shares in or debentures of a company incorporated or to be incorporated outside the United Kingdom (whether the company has or has not established, or when formed will or will not establish, a place of business in the United Kingdom), and

(b) application is made to a prescribed stock exchange for permission of those shares or debentures to be listed on that stock exchange.

(2) There may on the applicant's request be given by or on behalf of that stock exchange a certificate that, having regard to the proposals (as stated in the request) as to the size and other circumstances of the issue of shares or debentures and as to any limitation on the number and class of person to whom the offer is to be made, compliance with Schedule 3 would be unduly burdensome.

(3) If a certificate is given under paragraph (2), and if the proposals mentioned in that paragraph are adhered to and the particulars and information required to be published in connection with the application for permission to the stock exchange are so published, then—

(a) a prospectus giving the particulars and information in the form in which they are so required to be published is deemed to comply with Schedule 3, and

(b) except as respects the requirement for the prospectus to be dated, Article 82 does not apply to any issue, after the permission applied for is given, of a prospectus or form of application relating to the shares or debentures.

F114 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F115 Registration of prospectus before issue N.I.

87.—(1) It is unlawful for a person to issue, circulate or distribute in Northern Ireland a prospectus offering for subscription shares in or debentures of a company incorporated or to be incorporated outside the United Kingdom (whether the company has or has not established, or when formed will or will not establish, a place of business in the United Kingdom), unless before the issue, circulation or distribution of the prospectus in Northern Ireland the requirements of this Article have been complied with.

(2) A copy of the prospectus, certified by the chairman and two other directors of the company as having been approved by resolution of the managing body, must have been delivered for registration to the registrar or the registrar of companies as defined in the [1985 c. 6] Companies Act 1985.

(3) The prospectus must state on the face of it that a copy has been so delivered and the following must be endorsed on or attached to that copy of the prospectus—

(a) any consent to the issue of the prospectus which is required by Article 84;

(b) a copy of any contract required by paragraph 11 of Schedule 3 to be stated in the prospectus or, in the case of a contract not reduced into writing, a memorandum giving full particulars of it; and

(c) where the persons making any report required by Part II of Schedule 3 have made in it or have, without giving the reasons, indicated in it any such adjustments as are mentioned in paragraph 21 of that Schedule, a written statement signed by those persons setting out the adjustments and giving the reasons for them.

(4) If in the case of a prospectus deemed by virtue of a certificate under Article 86 to comply with Schedule 3, a contract or a copy of it, or a memorandum of a contract, is required to be available for inspection in connection with the application under that Article to the stock exchange, a copy or (as the case may be) a memorandum of the contract must be endorsed on or attached to the copy of the prospectus delivered to the registrar for registration.

(5) References in paragraphs (3)(b) and (4) to the copy of a contract are, in the case of a contract wholly or partly in a foreign language, to a copy of a translation of the contract into English, or a copy embodying a translation into English of the parts in foreign language (as the case may be); and—

(a) the translation must in either case be certified in the prescribed manner to be a correct translation, and

(b) the reference in paragraph (4) to a copy of a contract required to be available for inspection includes a copy of a translation of it or a copy embodying a translation of parts of it.

F115 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F116 Consequences (criminal and civil) of contravention of Articles 82 to 87 N.I.

88.—(1) A person who is knowingly responsible for the issue, circulation or distribution of a prospectus, or for the issue of a form of application for shares or debentures, in contravention of any of the provisions of Articles 82 to 87 is liable to a fine.

(2) Articles 77, 78 and 79 extend to every prospectus offering for subscription shares in or debentures of a company incorporated or to be incorporated outside the United kingdom (whether the company has or has not established, or when formed will or will not establish, a place of business in the United Kingdom), substituting for any reference to Article 71 a reference to Article 84.

(3) In the event of contravention of any of the requirements of Article 82(2) as regards the particulars to be contained in the prospectus, or Article 82(3) as regards compliance with Schedule 3, a director or other person responsible for the prospectus incurs no liability by reason of the contravention if—

(a) as regards any matter not disclosed, he proves that he was not cognisant of it, or

(b) he proves that the contravention arose from an honest mistake of fact on his part, or

(c) the contravention was in respect of matters which, in the opinion of the court dealing with the case, were immaterial or was otherwise such as ought, in the court's opinion, having regard to all the circumstances of the case, reasonably to be excused.

(4) In the event of failure to include in a prospectus to which this Chapter applies a statement with respect to the matters contained in paragraph 13 of Schedule 3, no director or other person incurs any liability in respect of the failure unless it is proved that he had knowledge of the matters not disclosed.

(5) Nothing in Article 82 or 83 or this Article limits or diminishes any liability which a person may incur under the general law or this Order, apart from those provisions.

F116 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

F117 Supplementary N.I.

89.—(1) Where a document by which the shares in or debentures of a company incorporated outside the United Kingdom are offered for sale to the public would, if the company had been a company incorporated under this Order, have been deemed by virtue of Article 68 to be a prospectus issued by the company, that document is deemed, for the purposes of this Chapter, a prospectus so issued.

(2) An offer of shares or debentures for subscription or sale to a person whose ordinary business it is to buy or sell shares or debentures (whether as principal or agent) is not deemed an offer to the public for those purposes.

(3) In this Chapter “shares” and “debentures” have the same meaning as when those expressions are used, elsewhere in this Order, in relation to a company incorporated under this Order.

F117 Pt. IV (arts. 66-89) repealed by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II (the repeal coming into force as mentioned in S.I. 1986/2246, art. 5, Sch. 4, S.I. 1988/740, arts. 2-7, Sch. (as amended by S.I 1988/1960, arts. 2-4 and by S.I. 1988/2285, arts. 2-6) and S.I. 1995/1538, art. 2 and otherwise prosp.)

PART VF1029 N.I. ALLOTMENT OF SHARES AND DEBENTURES

General provisions as to allotmentF1029 N.I.

Authority of company required for certain allotments N.I.

90.—(1) The directors of a company shall not exercise any power of the company to allot relevant securities unless they are, in accordance with this Article [F118 or Article 90A], authorised to do so by—

(a) the company in general meeting; or

(b) the company's articles.

(2) In this Article “relevant securities” means—

(a) shares in the company other than shares shown in the memorandum to have been taken by the subscribers to it or shares allotted in pursuance of an employees' share scheme, and

(b) any right to subscribe for, or to convert any security into, shares in the company (other than shares so allotted);

and a reference to the allotment of relevant securities includes the grant of such a right but (subject to paragraph (6)) not the allotment of shares pursuant to such a right.

(3) Authority under this Article may be given for a particular exercise of the power or for its exercise generally, and may be unconditional or subject to conditions.

(4) The authority must state the maximum amount of relevant securities that may be allotted under it and the date on which it will expire, which must be not more than 5 years from whichever is relevant of the following dates—

(a) in the case of an authority contained in the company's articles at the time of its original incorporation, the date of that incorporation; and

(b) in any other case, the date on which the resolution is passed by virtue of which the authority is given;

but such an authority (including an authority contained in the company's articles) may be previously revoked or varied by the company in general meeting.

(5) The authority may be renewed or further renewed by the company in general meeting for a further period not exceeding 5 years; but the resolution must state (or restate) the amount of relevant securities which may be allotted under the authority or, as the case may be, the amount remaining to be allotted under it, and must specify the date on which the renewed authority will expire.

(6) In relation to an authority under this Article for the grant of such rights as are mentioned in paragraph (2)(b), the reference in paragraph (4) (as also the corresponding reference in paragraph (5)) to the maximum amount of relevant securities that may be allotted under the authority is to the maximum amount of shares which may be allotted pursuant to the rights.

(7) The directors may allot relevant securities, notwithstanding that any authority under this Article has expired, if they are allotted in pursuance of an offer or agreement made by the company before the authority expired and the authority allowed it to make an offer or agreement which would or might require relevant securities to be allotted after the authority expired.

(8) A resolution of a company to give, vary, revoke or renew such an authority may, notwithstanding that it alters the company's articles, be an ordinary resolution; [F119 but in any case Chapter 3 of Part 3 of the Companies Act 2006 (resolutions affecting a company's constitution) applies to it.]

(9) A director who knowingly and wilfully contravenes, or permits or authorises a contravention of, this Article is liable to a fine.

(10) Nothing in this Article affects the validity of any allotment.

(11) This Article does not apply to any allotment of relevant securities by a company, other than a public company registered as such on its original incorporation, if it is made in pursuance of an offer or agreement made before the earlier of the following two dates—

(a) the date of the holding of the first general meeting of the company after its registration or re-registration as a public company, and

(b) 1st January 1985;

but any resolution to give, vary or revoke an authority for the purposes of Article 16 of the Order of 1981 or this Article has effect for those purposes if passed at any time on or after 10th June 1981.

F118 1990 NI 10

F119 Art. 90(8): word beginning "but it is in any case subject to Article 388" to the end omitted and substituted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(3) (with art. 12)

[F120 Election by private company as to duration of authority N.I.

90A.— (1) A private company may elect (by elective resolution in accordance with Article 387A) that the provisions of this Article shall apply, instead of the provisions of Article 90(4) and (5), in relation to the giving or renewal, after the election, of an authority under that Article.

(2) The authority must state the maximum amount of relevant securities that may be allotted under it and may be given—

(a) for an indefinite period, or

(b) for a fixed period, in which case it must state the date on which it will expire.

(3) In either case an authority (including an authority contained in the articles) may be revoked or varied by the company in general meeting.

(4) An authority given for a fixed period may be renewed or further renewed by the company in general meeting.

(5) A resolution renewing an authority—

(a) must state, or re-state, the amount of relevant securities which may be allotted under the authority or, as the case may be, the amount remaining to be allotted under it, and

(b) must state whether the authority is renewed for an indefinite period or for a fixed period, in which case it must state the date on which the renewed authority will expire.

(6) The references in this Article to the maximum amount of relevant securities that may be allotted shall be construed in accordance with Article 90(6).

(7) If an election under this Article ceases to have effect, an authority then in force which was given for an indefinite period or for a fixed period of more than five years—

(a) if given five years or more before the election ceases to have effect, shall expire forthwith, and

(b) otherwise, shall have effect as if it had been given for a fixed period of five years.]

F120 1990 NI 10

F121 Restriction on public offers by private company N.I.

91.—(1) A private limited company (other than a company limited by guarantee and not having a share capital) commits an offence if it—

(a) offers to the public (whether for cash or otherwise) any shares in or debentures of the company; or

(b) allots or agrees to allot (whether for cash or otherwise) any shares in or debentures of the company with a view to all or any of those shares or debentures being offered for sale to the public (within the meaning given to that expression by[F122 Articles 68 and 10A]).

(2) A company guilty of an offence under this Article, and any officer of it who is in default, is liable to a fine.

(3) Nothing in this Article affects the validity of any allotment or sale of shares or debentures, or of any agreement to allot or sell shares or debentures.

F121 prosp. in part rep. by 1986 c. 60

F122 SI 2004/355

F123 Application for, and allotment of, shares and debentures N.I.

92.—(1) No allotment shall be made of a company's shares or debentures in pursuance of a prospectus issued generally, and no proceedings shall be taken on applications made in pursuance of a prospectus so issued, until the beginning of the third day after that on which the prospectus is first so issued or such later time (if any) as may be specified in the prospectus.

(2) The beginning of that third day, or that later time, is “the time of the opening of the subscription lists”.

(3) In paragraph (1), the reference to the day on which the prospectus is first issued generally is to the day when it is first so issued as a newspaper advertisement; and if it is not so issued as a newspaper advertisement before the third day after that on which it is first so issued in any other manner, the reference is to the day on which it is first so issued in any manner.

(4) In reckoning for this purpose the third day after another day—

(a) any intervening day which is a Saturday or Sunday, or which is a bank holiday, is to be disregarded; and

(b) if the third day (as so reckoned) is itself a Saturday or Sunday, or a bank holiday, there is to be substituted the first day after that which is none of them.

(5) The validity of an allotment is not affected by any contravention of paragraphs (1) to (4); but in the event of contravention, the company and every officer of it who is in default is liable to a fine.

(6) As applying to a prospectus offering shares or debentures for sale, paragraphs (1) to (5) are modified as follows—

(a) for references to allotment, substitute references to sale; and

(b) for the reference to the company and every officer of it who is in default, substitute a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the contravention.

(7) An application for shares in or debentures of a company which is made in pursuance of a prospectus issued generally is not revocable until after the expiration of the third day after the time of the opening of the subscription lists, or the giving before the expiration of that day of the appropriate public notice; and that notice is one given by some person responsible under Articles 77 to 79 for the prospectus and having the effect under those Articles of excluding or limiting the responsibility of the giver.

F123 prosp. in part rep. by 1986 c. 60

F124 No allotment unless minimum subscription received N.I.

93.—(1) No allotment shall be made of any share capital of a company offered to the public for subscription unless—

(a) there has been subscribed the amount stated in the prospectus as the minimum amount which, in the opinion of the directors, must be raised by the issue of share capital in order to provide for the matters specified in paragraph 2 of Schedule 3 (preliminary expenses, purchase of property, working capital, etc); and

(b) the sum payable on application for the amount so stated has been paid to and received by the company.

(2) For the purposes of paragraph (1)(b), a sum is deemed paid to the company, and received by it, if a cheque for that sum has been received in good faith by the company and the directors have no reason for suspecting that the cheque will not be paid.

(3) The amount so stated in the prospectus is to be reckoned exclusively of any amount payable otherwise than in cash and is known as “the minimum subscription”.

(4) If the above conditions have not been complied with on the expiration of 40 days after the first issue of the prospectus, all money received from applicants for shares shall be forthwith repaid to them without interest.

(5) If any of the money is not repaid within 48 days after the issue of the prospectus, the directors of the company are jointly and severally liable to repay it with interest at the rate of 5 per cent. per annum from the expiration of the 48th day; except that a director is not so liable if he proves that the default in the repayment of the money was not due to any misconduct or negligence on his part.

(6) Any condition requiring or binding an applicant for shares to waive compliance with any requirement of this Article is void.

(7) This Article does not apply to an allotment of shares subsequent to the first allotment of shares offered to the public for subscription.

F124 prosp. in part rep. by 1986 c. 60

Allotment where issue not fully subscribed N.I.

94.—(1) No allotment shall be made of any share capital of a public company offered for subscription unless—

(a) that capital is subscribed for in full; or

(b) the offer states that, even if the capital is not subscribed for in full, the amount of that capital subscribed for may be allotted in any event or in the event of the conditions specified in the offer being satisfied;

and, where conditions are so specified, no allotment of the capital shall be made by virtue of sub-paragraph (b) unless those conditions are satisfied.

F125 This is without prejudice to Article 93.

(2) If shares are prohibited from being allotted by paragraph (1) and 40 days have elapsed after the first issue of the prospectus, all money received from applicants for shares shall be forthwith repaid to them without interest.

(3) If any of the money is not repaid within 48 days after the issue of the prospectus, the directors of the company are jointly and severally liable to repay it with interest at the rate of 5 per cent. per annum from the expiration of the 48th day; except that a director is not so liable if he proves that the default in repayment was not due to any misconduct or negligence on his part.

(4) This Article applies in the case of shares offered as wholly or partly payable otherwise than in cash as it applies in the case of shares offered for subscription (the word “subscribed” in paragraph (1) being construed accordingly).

(5) In paragraphs (2) and (3) as they apply to the case of shares offered as wholly or partly payable otherwise than in cash, references to the repayment of money received from applicants for shares include—

(a) the return of any other consideration so received (including, if the case so requires, the release of the applicant from any undertaking), or

(b) if it is not reasonably practicable to return the consideration, the payment of money equal to its value at the time it was so received,

and references to interest apply accordingly.

(6) Any condition requiring or binding an applicant for shares to waive compliance with any requirement of this Article is void.

F125 prosp. in part rep. by 1986 c. 60

Effect of irregular allotment N.I.

95.—(1) An allotment made by a company to an applicant in contravention of ArticleF126 93 or 94 is voidable at the instance of the applicant within one month after the date of the allotment, and not later, and is so voidable notwithstanding that the company is in the course of being wound up.

(2) If a director of a company knowingly contravenes, or permits or authorises the contravention of, any provision of either of those Articles with respect to allotment, he is liable to compensate the company and the allottee respectively for any loss, damages or costs which the company or the allottee may have sustained or incurred by the contravention.

(3) But proceedings to recover any such loss, damages or costs shall not be commenced after the expiration of 2 years from the date of the allotment.

F126 prosp. in part rep. by 1986 c. 60

F127 Allotment of shares, etc. to be listed on a stock exchange N.I.

96.—(1) This Article applies where a prospectus, whether issued generally or not, states that application has been or will be made for permission for the shares or debentures offered by it to be listed on any stock exchange.

(2) An allotment made on an application in pursuance of the prospectus is, whenever made, void if the permission has not been applied for before the third day after the first issue of the prospectus or, if the permission has been refused, before the expiration of 3 weeks from the date of the closing of the subscription lists or such longer period (not exceeding 6 weeks) as may, within those 3 weeks, be notified to the applicant for permission by or on behalf of the stock exchange.

(3) In reckoning for this purpose the third day after another day—

(a) any intervening day which is a Saturday or Sunday, or which is a bank holiday, is to be disregarded; and

(b) if the third day (as so reckoned) is itself a Saturday or Sunday or a bank holiday, there is to be substituted the first day after that which is none of them.

(4) Where permission has not been applied for as mentioned in paragraph (2), or has been refused as so mentioned, the company shall forthwith repay (without interest) all money received from applicants in pursuance of the prospectus.

(5) If any of the money is not repaid within 8 days after the company becomes liable to repay it, the directors of the company are jointly and severally liable to repay the money with interest at the rate of 5 per cent. per annum from the expiration of the 8th day, except that a director is not liable if he proves that the default in the repayment of the money was not due to any misconduct or negligence on his part.

(6) All money received from applicants in pursuance of the prospectus shall be kept in a separate bank account so long as the company may become liable to repay it under paragraph (4); and if default is made in complying with this paragraph, the company and every officer of it who is in default is liable to a fine.

(7) Any condition requiring or binding an applicant for shares or debentures to waive compliance with any requirement of this Article is void.

(8) For the purposes of this Article, permission is not deemed to be refused if it is intimated that the application for it, though not at present granted, will be given further consideration.

(9) This Article has effect in relation to shares or debentures agreed to be taken by a person underwriting an offer of them by a prospectus as if he had applied for them in pursuance of the prospectus.

F127 prosp. in part rep. by 1986 c. 60

F128 Operation of Article 96 where prospectus offers shares for sale N.I.

97.—(1) This Article has effect as regards the operation of Article 96 in relation to a prospectus offering shares for sale.

(2) Paragraphs (1) and (2) of that Article apply, but with the substitution for the reference in paragraph (2) to allotment of a reference to sale.

(3) Paragraphs (4) and (5) of that Article do not apply; but—

(a) if the permission referred to in paragraph (2) of that Article has not been applied for as there mentioned, or has been refused as there mentioned, the offeror of the shares shall forthwith repay (without interest) all money received from applicants in pursuance of the prospectus, and

(b) if any such money has not been repaid within 8 days after the offeror becomes liable to repay it, he becomes liable to pay interest on the money due, at the rate of 5 per cent. per annum from the end of the 8th day.

(4) Paragraphs (6) to (9) of that Article apply, except that in paragraph (6)—

(a) for the first reference to the company there is substituted a reference to the offeror, and

(b) for the reference to the company and every officer of the company who is in default there is substituted a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the default.

F128 prosp. in part rep. by 1986 c. 60

Return as to allotments, etc. N.I.

98.—(1) This Article applies to a company limited by shares and to a company limited by guarantee and having a share capital.

(2) When such a company makes an allotment of its shares, the company shall within one month thereafter deliver to the registrar for registration—

(a) a return of the allotments (in the prescribed form) stating the number and nominal amount of the shares comprised in the allotment, the names and addresses of the allottees, and the amount (if any) paid or due and payable on each share, whether on account of the nominal value of the share or by way of premium; and

(b) in the case of shares allotted as fully or partly paid up otherwise than in cash—

(i) a contract in writing constituting the title of the allotee to the allotment together with any contract of sale, or for services or other consideration in respect of which that allotment was made (such contracts being duly stamped), and

(ii) a return stating the number and nominal amount of shares so allotted, the extent to which they are to be treated as paid up, and the consideration for which they have been allotted.

(3) Where such a contract as mentioned in paragraph (2) is not reduced to writing, the company shall within one month after the allotment deliver to the registrar for registration the prescribed particulars of the contractF129 . . . .

Para.(4) rep. by SI 2005/1634

(5) If default is made in complying with this Article, every officer of the company who is in default is liable to a fine and, for continued contravention, to a daily default fine, but subject as follows.

(6) In the case of default in delivering to the registrar within one month after the allotment any document required by this Article to be delivered, the company, or any officer liable for the default, may apply to the court for relief; and the court, if satisfied that the omission to deliver the document was accidental or due to inadvertence or that it is just and equitable to grant relief, may make an order extending the time for the delivery of the document for such period as the court thinks proper.

F129 SI 2005/1634

Pre-emption rightsF1029 N.I.

Offers to shareholders to be on pre-emptive basis N.I.

99.—(1) Subject to the provisions of this Article and Articles 100 to 106, a company proposing to allot equity securities (as defined in Article 104)—

(a) shall not allot any of them on any terms to a person unless it has made an offer to each person who holds relevant shares or relevant employee shares to allot to him on the same or more favourable terms a proportion of those securities which is as nearly as practicable equal to the proportion in nominal value held by him of the aggregate of relevant shares and relevant employee shares, and

(b) shall not allot any of those securities to a person unless the period during which any such offer may be accepted has expired or the company has received notice of the acceptance or refusal of every offer so made.

(2) Paragraph (3) applies to any provision of a company's memorandum or articles which requires the company, when proposing to allot equity securities consisting of relevant shares of any particular class, not to allot those securities on any terms unless it has complied with the condition that it makes such an offer as is described in paragraph (1) to each person who holds relevant shares or relevant employee shares of that class.

(3) If in accordance with a provision to which this paragraph applies—

(a) a company makes an offer to allot securities to such a holder, and

(b) he or anyone in whose favour he has renounced his right to their allotment accepts the offer,

paragraph (1) does not apply to the allotment of those securities, and the company may allot them accordingly; but this is without prejudice to the application of paragraph (1) in any other case.

(4) Paragraph (1) does not apply to a particular allotment of equity securities if these are, or are to be, wholly or partly paid up otherwise than in cash; and securities which a company has offered to allot to a holder of relevant shares or relevant employee shares may be allotted to him, or anyone in whose favour he has renounced his right to their allotment, without contravening paragraph (1)(b).

(5) Paragraph (1) does not apply to the allotment of securities which would, apart from a renunciation or assignment of the right to their allotment, be held under an employees' share scheme.

[F130 (6) Where a company holds relevant shares as treasury shares—

(a) for the purposes of paragraphs (1) and (2), the company is not a “person who holds relevant shares”; and

(b) for the purposes of paragraph (1), the shares held as treasury shares do not form part of “the aggregate of relevant shares and relevant employee shares”.]

F130 SR 2004/275

Communication of pre-emption offers to shareholders N.I.

100.—(1) This Article has effect as to the manner in which offers required by Article 99(1), or by a provision to which Article 99(3) applies, are to be made to holders of a company's shares.

(2) Subject to paragraphs (3) to (7), an offer shall be in writing and shall be made to a holder of shares either personally or by sending it by post (that is to say, prepaying and posting a letter containing the offer) to him or to his registered address or, if he has no registered address in the United Kingdom, to the address in the United Kingdom supplied by him to the company for the giving of notice to him.

If sent by post, the offer is deemed to be made at the time at which the letter would be delivered in the ordinary course of post.

(3) Where shares are held by 2 or more persons jointly, the offer may be made to the joint holder first named in the register of members in respect of the shares.

(4) In the case of a holder's death or bankruptcy, the offer may be made—

(a) by sending it by post in a prepaid letter addressed to the persons claiming to be entitled to the shares in consequence of the death or bankruptcy by name, or by the title of representatives of the deceased, or assignee in bankruptcy, or by any like description, at the address in the United Kingdom supplied for the purpose by those so claiming, or

(b) until such an address has been so supplied, by giving the notice in any manner in which it might have been given if the death or bankruptcy had not occurred.

(5) If the holder—

(a) has no registered address in the United Kingdom and has not given to the company an address in the United Kingdom for the service of notices on him, or

(b) is the holder of a share warrant,

the offer may be made by causing it, or a notice specifying where a copy of it can be obtained or inspected, to be published in the Belfast Gazette.

(6) The offer must state a period of not less than 21 days during which it may be accepted; and the offer shall not be withdrawn before the end of that period.

(7) This Article does not invalidate a provision to which Article 99(3) applies by reason that that provision requires or authorises an offer under it to be made in contravention of any of paragraphs (1) to (6); but, to the extent that the provision requires or authorises such an offer to be so made, it is of no effect.

Exclusion of Articles 99 and 100 by private company N.I.

101.—(1) Article 99(1), 100(1) to (5) or 100(6) may, as applying to allotments by a private company of equity securities or to such allotments of a particular description, be excluded by a provision contained in the memorandum or articles of that company.

(2) A requirement or authority contained in the memorandum or articles of a private company, if it is inconsistent with any of those Articles, has effect as a provision excluding that Article; but a provision to which Article 99(3) applies is not to be treated as inconsistent with Article 99(1).

Consequences of contravening Articles 99 and 100 N.I.

102.—(1) If there is a contravention of Article 99(1), or of Article 100(1) to (5) or of Article 100(6), or of a provision to which Article 99(3) applies, the company, and every officer of it who knowingly authorised or permitted the contravention, are jointly and severally liable to compensate any person to whom an offer should have been made under the Article or provision contravened for any loss, damage, costs or expenses which the person has sustained or incurred by reason of the contravention.

(2) However, no proceedings to recover any such loss, damage, costs or expenses shall be commenced after the expiration of 2 years from the delivery to the registrar of the return of allotments in question or, where equity securities other than shares are granted, from the date of the grant.

Saving for other restrictions as to offers N.I.

103.—(1) Articles 99 to 102 are without prejudice to any statutory provision by virtue of which a company is prohibited (whether generally or in specified circumstances) from offering or allotting equity securities to any person.

(2) Where a company cannot by virtue of such a statutory provision offer or allot equity securities to a holder of relevant shares or relevant employee shares, those Articles have effect as if the shares held by that holder were not relevant shares or relevant employee shares.

Interpretation for Articles 99 to 106 N.I.

104.—(1) The following paragraphs apply for the interpretation of Articles 99 to 106.

(2) “Equity security”, in relation to a company, means a relevant share in the company (other than a share shown in the memorandum to have been taken by a subscriber to the memorandum or a bonus share), or a right to subscribe for, or to convert securities into, relevant shares in the company.

(3) A reference to the allotment of equity securities or of equity securities consisting of relevant shares of a particular class includes the grant of a right to subscribe for, or to convert any securities into, relevant shares in the company or (as the case may be) relevant shares of a particular class; but such a reference does not include the allotment of relevant shares pursuant to such a right.

[F131 (3A) A reference to the allotment of equity securities or of equity securities consisting of relevant shares of a particular class also includes the sale of any relevant shares in the company or (as the case may be) relevant shares of a particular class if, immediately before the sale, the shares were held by the company as treasury shares.]

(4) “Relevant employee shares”, in relation to a company, means shares of the company which would be relevant shares in it but for the fact that they are held by a person who acquired them in pursuance of an employees' share scheme.

(5) “Relevant shares”, in relation to a company, means shares in the company other than—

(a) shares which as respects dividends and capital carry a right to participate only up to a specified amount in a distribution, and

(b) shares which are held by a person who acquired them in pursuance of an employees' share scheme or, in the case of shares which have not been allotted, are to be allotted in pursuance of such a scheme[F131 or, in the case of shares held by the company as treasury shares, are to be transferred in pursuance of such a scheme].

(6) A reference to a class of shares is to shares to which the same rights are attached as to voting and as to participation, both as respects dividends and as respects capital, in a distribution.

(7) In relation to an offer to allot securities required by Article 99(1) or by any provision to which Article 99(3) applies, a reference in Articles 99 to 103 and this Article (however expressed) to the holder of shares of any description is to whoever was at the close of business on a date, to be specified in the offer and to fall in the period of 28 days immediately before the date of the offer, the holder of shares of that description.

F131 SR 2004/275

Disapplication of pre-emption rights N.I.

105.—(1) Where the directors of a company are generally authorised for the purposes of Article 90, they may be given power by the articles of association, or by a special resolution of the company, to allot equity securities pursuant to that authority as if—

(a) Article 99(1) did not apply to the allotment, or

(b) that Article applied to the allotment with such modifications as the directors may determine;

and where the directors make an allotment under this paragraph, Articles 99 to 104 have effect accordingly.

(2) Where the directors of a company are authorised for the purposes of Article 90 (whether generally or otherwise), the company may by special resolution resolve either—

(a) that Article 99(1) shall not apply to a specified allotment of equity securities to be made pursuant to that authority, or

(b) that that Article shall apply to the allotment with such modifications as may be specified in the resolution;

and where such a resolution is passed, Articles 99 to 104 have effect accordingly.

[F132 (2A) Paragraphs (1) and (2) apply in relation to a sale of shares which is an allotment of equity securities by virtue of Article 104(3A) as if—

(a) in paragraph (1) for “Where the directors of a company are generally authorised for the purposes of Article 90, they” there were substituted “ The directors of a company ” and the words “pursuant to that authority” were omitted, and

(b) in paragraph (2), the words from “Where” to “otherwise), the” there were substituted “ The ” and, in sub-paragraph (a), the words “to be made pursuant to that authority” were omitted.]

(3) The powers conferred by paragraph (1) or a special resolution under paragraph (2) ceases to have effect when the authority to which it relates is revoked or would (if not renewed) expire; but if the authority is renewed, the power or (as the case may be) the resolution may also be renewed, for a period not longer than that for which the authority is renewed, by a special resolution of the company.

(4) Notwithstanding that any such power or resolution has expired, the directors may allot equity securities in pursuance of an offer or agreement previously made by the company, if the power or resolution enabled the company to make an offer or agreement which would or might require equity securities to be allotted after it expired.

(5) A special resolution under paragraph (2), or a special resolution to renew such a resolution, shall not be proposed unless it is recommended by the directors and there has been circulated, with the notice of the meeting at which the resolution is proposed, to the members entitled to have that notice a written statement by the directors setting out—

(a) their reasons for making the recommendation,

(b) the amount to be paid to the company in respect of the equity securities to be allotted, and

(c) the directors' justification of that amount.

(6) A person who knowingly or recklessly authorises or permits the inclusion in a statement circulated under paragraph (5) of any matter which is misleading, false or deceptive in a material particular is liable to imprisonment or a fine, or both.

F132 SR 2004/275

Saving for company's pre-emption procedure operative before 1985 N.I.

106.—(1) Where a company which is re-registered or registered as a public company is or, but for the provisions of the Order of 1981 and the statutory provisions replacing it, would be subject at the time or re-registration or (as the case may be) registration to a pre-1985 pre-emption requirement, Articles 99 to 105 do not apply to an allotment of the equity securities which are subject to that requirement.

(2) A “pre-1985 pre-emption requirement” is a requirement imposed (whether by the company's memorandum or articles, or otherwise) before the relevant date by virtue of which the company must, when making an allotment of equity securities, make an offer to allot those securities or some of them in a manner which (otherwise than because involving a contravention of Article 100(1) to (5) or 100(6)) is inconsistent with Articles 99 to 104; and “the relevant date” is—

(a) except in a case falling within sub-paragraph (b), 1st January 1985, and

(b) in the case of a company which was re-registered or registered as a public company on an application made before that date, the date on which the application was made.

(3) A requirement which—

(a) is imposed on a private company (having been so imposed before the relevant date) otherwise than by the company's memorandum or articles, and

(b) if contained in the company's memorandum or articles, would have effect under Article 101 to the exclusion of any provisions of Articles 99 to 104,

has effect, so long as the company remains a private company as if it were contained in its memorandum or articles.

(4) If on the relevant date a company, other than a public company registered as such on its original incorporation, was subject to such a requirement as is mentioned in Article 99(2) imposed otherwise than by its memorandum or articles, the requirement is to be treated for the purposes of Articles 99 to 104 as if it were contained in the company's memorandum or articles.

Commissions and discountsF1029 N.I.

Power of company to pay commissions N.I.

107.—(1) It is lawful for a company to pay a commission to any person in consideration of his subscribing or agreeing to subscribe (whether absolutely or conditionally) for any shares in the company, or procuring or agreeing to procure subscriptions (whether absolute or conditional) for any shares in the company, if the following conditionsF133 are satisfied.

(2) The payment of the commission must be authorised by the company's articles; and—

(a) the commission paid or agreed to be paid must not exceedF133 10 per cent. of the price at which the shares are issued or the amount or rate authorised by the articles, whichever is the less;F134 and

F134 (b) the amount or rate per cent. of commission paid or agreed to be paid, and the number of shares which persons have agreed for a commission to subscribe absolutely, must be disclosed in the manner required by paragraph (3).

F134 (3) Those matters must, in the case of shares offered to the public for subscription, be disclosed in the prospectus; and in the case of shares not so offered—

(a) they must be disclosed in a statement in the prescribed form signed by every director of the company or by his agent authorised in writing, and delivered (before payment of the commission) to the registrar for registration; and

(b) where a circular or notice (not being a prospectus) inviting subscription for the shares is issued, they must also be disclosed in that circular or notice.

F134 (4) If default is made in complying with paragraph (3)(a) as regards delivery to the registrar of the statement in prescribed form, the company and every officer of it who is in default is liable to a fine.

F133 prosp. 1986 c. 60

F134 prosp. in part rep. by 1986 c. 60

Apart from Article 107, commissions and discounts barred N.I.

108.—(1) Except as permitted by Article 107, no company shall apply any of its shares or capital money either directly or indirectly in payment of any commission, discount or allowance to any person in consderation of his subscribing or agreeing to subscribe (whether absolutely or conditionally) for any shares in the company, or procuring or agreeing to procure subscriptions (whether absolute or conditional) for any shares in the company.

(2) This applies whether the shares or money be so applied by being added to the purchase money of any property acquired by the company or to the contract price of any work to be executed for the company, or the money be paid out of the nominal purchase money or contract price, or otherwise.

(3) Nothing in Article 107 or this Article affects the power of a company to pay such brokerage as has heretofore been lawful.

(4) A vendor to, or promoter of, or other person who receives payment in money or shares from, a company has and is deemed always to have had power to apply any part of the money or shares so received in payment of any commission, the payment of which, if made directly by the company, would have been lawful under Article 107 and this Article.

Amount to be paid for shares; the means of paymentF1029 N.I.

General rules as to payment for shares on allotment N.I.

109.—(1) Subject to the following provisions of this Part, shares allotted by a company, and any premium on them, may be paid up in money or money's worth (including goodwill and know-how).

(2) A public company shall not accept at any time, in payment up of its shares or any premium on them, an undertaking given by any person that he or another should do work or perform services for the company or any other person.

(3) If a public company accepts such an undertaking in payment up of its shares or any premium on them, the holder of the shares when they or the premium are treated as paid up (in whole or in part) by the undertaking is liable—

(a) to pay the company in respect of those shares an amount equal to their nominal value, together with the whole or any premium or, if the case so requires, such proportion of that amount as is treated as paid up by the undertaking; and

(b) to pay interest at the appropriate rate on the amount payable under sub-paragraph (a).

(4) This Article does not prevent a company from allotting bonus shares to its members or from paying up, with sums available for the purpose, any amounts for the time being unpaid on any of its shares (whether on account of the nominal value of the shares or by way of premium).

(5) The reference in paragraph (3) to the holder of shares includes any person who has an unconditional right to be included in the company's register of members in respect of those shares or to have an instrument of transfer of them executed in his favour.

Prohibition on allotment of shares at a discount N.I.

110.—(1) A company's shares shall not be allotted at a discount.

(2) If shares are allotted in contravention of this Article, the allottee is liable to pay the company an amount equal to the amount of the discount, with interest at the appropriate rate.

Shares to be allotted as at least one-quarter paid-up N.I.

111.—(1) A public company shall not allot a share except as paid up at least as to one-quarter of its nominal value and the whole of any premium on it.

(2) Paragraph (1) does not apply to shares allotted in pursuance of an employees' share scheme.

(3) If a company allots a share in contravention of paragraph (1), the share is to be treated as if one-quarter of its nominal value, together with the whole of any premium on it, had been received.

(4) But the allottee is liable to pay the company the minimum amount which should have been received in respect of the share under paragraph (1) (less the value of any consideration actually applied in payment up, to any extent, of the share and any premium on it), with interest at the appropriate rate.

(5) Paragraphs (3) and (4) do not apply to the allotment of bonus shares, unless the allottee knew or ought to have known that the shares were allotted in contravention of paragraph (1).

Restriction on payment by long-term undertaking N.I.

112.—(1) A public company shall not allot shares as fully or partly paid up (as to their nominal value or any premium on them) otherwise than in cash if the consideration for the allotment is or includes an undertaking which is to be, or may be, performed more than 5 years after the date of the allotment.

(2) If a company allots shares in contravention of paragraph (1), the allottee is liable to pay the company an amount equal to the aggregate of their nominal value and the whole of any premium (or, if the case so requires, so much of that aggregate as is treated as paid up by the undertaking), with interest at the appropriate rate.

(3) Where a contract for the allotment of shares does not contravene paragraph (1), any variation of the contract which has the effect that the contract would have contravened that paragraph, if the terms of the contract as varied had been its original terms, is void.

(4) Paragraph (3) applies also to the variation by a public company of the terms of a contract entered into before the company was re-registered as a public company.

(5) Paragraph (6) applies where a public company allots shares for a consideration which consists of or includes (in accordance with paragraph (1)) an undertaking which is to be performed within 5 years of the allotment, but the undertaking is not performed within the period allowed by the contract for the allotment of the shares.

(6) The allottee is then liable to pay the company, at the end of the period so allowed, an amount equal to the aggregate of the nominal value of the shares and the whole of any premium (or, if the case so requires, so much of that aggregate as is treated as paid up by the undertaking), with interest at the appropriate rate.

(7) A reference in this Article to a contract for the allotment of shares includes an ancillary contract relating to payment in respect of them.

Non-cash consideration to be valued before allotment N.I.

113.—(1) A public company shall not allot shares as fully or partly paid up (as to their nominal value or any premium on them) otherwise than in cash unless—

(a) the consideration for the allotment has been independently valued under Article 118; and

(b) a report with respect to its value has been made to the company by a person appointed by the company (in accordance with that Article) during the 6 months immediately preceding the allotment of the shares; and

(c) a copy of the report has been sent to the proposed allottee.

(2) Where an amount standing to the credit of any of a company's reserve accounts, or of its profit and loss account, is applied in paying up (to any extent) any shares allotted to members of the company or any premiums on shares so allotted, the amount applied does not count as consideration for the allotment, and accordingly paragraph (1) does not apply in that case.

(3) Paragraph (1) does not apply to the allotment of shares by a company in connection with an arrangement providing for the allotment of shares in that company on terms that the whole or part of the consideration for the shares allotted is to be provided by the transfer to that company (or the cancellation) of all or some of the shares, or of all or some of the shares of a particular class, in another company (with or without the issue to that company of shares, or of shares of any particular class, in that other company).

(4) But paragraph (3) does not exclude the application of paragraph (1) unless under the arrangement it is open to all the holders of the shares in the other company in question[F135 ("the relevant company")] (or, where the arrangement applies only to shares of a particular class, to all the holders of shares in[F135 the relevant company], being holders of shares of that class) to take part in the arrangement.

[F135 In determining whether that is the case, the following shall be disregarded—

(a)

shares held by or by a nominee of the company proposing to allot the shares in connection with the arrangement ( “the allotting company”);

(b)

shares held by or by a nominee of a company which is—

(i)

the holding company or a subsidiary of the allotting company, or

(ii)

a subsidiary of that holding company; and

(c)

shares held as treasury shares by the relevant company.]

(5) Paragraph (1) also does not apply to the allotment of shares by a company in connection with its proposed merger with another company; that is, where one of the companies proposes to acquire all the assets and liabilities of the other in exchange for the issue of shares or other securities in that one to shareholders of the other, with or without any cash payment to those shareholders.

(6) If a company allots shares in contravention of paragraph (1) and either—

(a) the allottee has not received the valuer's report required by that paragraph to be sent to him; or

(b) there has been some other contravention of this Article or Article 118 which the allottee knew or ought to have known amounted to a contravention,

the allottee is liable to pay the company an amount equal to the aggregate of the nominal value of the shares and the whole of any premium (or, if the case so requires, so much of that aggregate as is treated as paid up by the consideration), with interest at the appropriate rate.

(7) In this Article—

(a) “arrangement” means any agreement, scheme or arrangement (including an arrangement sanctioned in accordance with Article 418 (company compromise with creditors and members) or[F136 Article 96 of the Insolvency Order] (liquidator in winding up accepting shares as consideration for sale of company property)), and

(b) any reference to a company, except where it is or is to be construed as a reference to a public company, includes any body corporate and any body to which letters patent have been issued under the [1837 c.73] Chartered Companies Act 1837.

F135 SR 2004/275

F136 1989 NI 19

Transfer to public company of non-cash asset in initial period N.I.

114.—(1) A public company formed as such shall not, unless the conditions of this Article have been complied with, enter into an agreement with a person for the transfer by him during the initial period of one or more non-cash assets to the company or another, if—

(a) that person is a subscriber to the company's memorandum; and

(b) the consideration for the transfer to be given by the company is equal in value at the time of the agreement to one-tenth or more of the nominal value of the company's share capital issued at that time.

(2) “The initial period” for this purpose is 2 years beginning with the date of the company being issued with a certificate under Article 127 (or the previous corresponding provision) that it was entitled to do business.

(3) This Article applies also to a company re-registered as a public company (except one re-registered under Article 10 of the Order of 1981 or Article 4 of the Consequential Provisions Order), or registered under Article 634 (joint stock company) or the previous corresponding provision; but in that case—

(a) there is substituted a reference in paragraph (1)(a) to a person who is a member of the company on the date of registration or re-registration, and

(b) the initial period is then 2 years beginning with that date.

In this paragraph the reference to a company re-registered as a public company includes a private company so re-registered which was a public company before it was a private company.

(4) The conditions of this Article are as follows—

(a) the consideration to be received by the company, and any consideration other than cash to be given by the company, must have been independently valued under Article 119;

(b) a report with respect to the consideration to be so received and given must have been made to the company in accordance with that Article during the 6 months immediately preceding the date of the agreement;

(c) the terms of the agreement must have been approved by an ordinary resolution of the company; and

(d) not later than the giving of the notice of the meeting at which the resolution is proposed, copies of the resolution and report must have been circulated to the members of the company entitled to receive the notice and, if the person with whom the agreement in question is proposed to be made is not then a member of the company so entitled, to that person.

(5) In paragraph (4)(a)—

(a) the reference to the consideration to be received by the company is to the asset to be transferred to it or the advantage to the company of the asset's transfer to another person; and

(b) the specified condition is without prejudice to any requirement to value any consideration for the purposes of Article 113.

(6) In the case of the following agreements, this Article does not apply—

(a) where it is part of the company's ordinary business to acquire, or arrange for others to acquire, assets of a particular description, an agreement entered into by the company in the ordinary course of its business for the transfer of an asset of that description to it or to such a person, as the case may be; or

(b) an agreement entered into by the company under the supervision of the court, or of an officer authorised by the court for the purpose, for the transfer of an asset to the company or to another.

Agreements contravening Article 114 N.I.

115.—(1) Paragraph (2) applies if a public company enters into an agreement contravening Article 114, the agreement being made with the person referred to in paragraph (1)(a) or (as the case may be) paragraph (3) of that Article, and either—

(a) that person has not received the valuer's report required for compliance with the conditions of that Article, or

(b) there has been some other contravention of that Article or of Article 118(1), (2) or (5) or Article 119, which he knew or ought to have known amounted to a contravention.

(2) The company is then entitled to recover from that person any consideration given by it under the agreement, or an amount equal to the value of the consideration at the time of the agreement; and the agreement, so far as not carried out, is void.

(3) However, if the agreement is or includes an agreement for the allotment of shares in the company, then—

(a) whether or not the agreement also contravenes Article 113, paragraph (2) does not apply to it in so far as it is for the allotment of shares; and

(b) the allottee is liable to pay the company an amount equal to the aggregate of the nominal value of the shares and the whole of any premium (or, if the case so requires, so much of that aggregate as is treated as paid up by the consideration), with interest at the appropriate rate.

Shares issued to subscribers of memorandum N.I.

116.  Shares taken by a subscriber to the memorandum of a public company in pursuance of an undertaking of his in the memorandum, and any premium on the shares, shall be paid up in cash.

Meaning of “the appropriate rate” N.I.

117.  In Articles 109 to 115 “the appropriate rate”, in relation to interest, means 5 per cent. per annum or such other rate as may be specified by order made by the Department subject to negative resolution.

Valuation provisionsF1029 N.I.

Valuation and report (Articles 54 and 113) N.I.

118.—(1) The valuation and report required by Article 113 (or, where applicable, Article 54) shall be made by an independent person, that is to say a person qualified at the time of the report to be appointed, or continue to be, an auditor of the company.

(2) However, where it appears to the independent person (from here on referred to as “the valuer”) to be reasonable for the valuation of the consideration, or part of it, to be made (or for him to accept such a valuation) by another person who—

(a) appears to him to have the requisite knowledge and experience to value the consideration or that part of it; and

(b) is not an officer or servant of the company or any other body corporate which is that company's subsidiary or holding company or a subsidiary of that company's holding company or a partner or employee of such an officer or servant,

he may arrange for or accept such a valuation, together with a report which will enable him to make his own report under this Article and provide the note required by paragraph (6).

(3) The reference in paragraph (2)(b) to an officer or servant does not include an auditor.

(4) The valuer's report shall state—

(a) the nominal value of the shares to be wholly or partly paid for by the consideration in question;

(b) the amount of any premium payable on the shares;

(c) the description of the consideration and, as respects so much of the consideration as he himself has valued, a description of that part of the consideration, the method used to value it and the date of the valuation;

(d) the extent to which the nominal value of the shares and any premium are to be treated as paid up—

(i) by the consideration;

(ii) in cash.

(5) Where the consideration or part of it is valued by a person other than the valuer himself, the latter's report shall state that fact and shall also—

(a) state the former's name and what knowledge and experience he has to carry out the valuation; and

(b) describe so much of the consideration as was valued by the other person, and the method used to value it, and specify the date of the valuation.

(6) The valuer's report shall contain or be accompanied by a note by him—

(a) in the case of a valuation made by a person other than himself, that it appeared to himself reasonable to arrange for it to be so made or to accept a valuation so made;

(b) whoever made the valuation, that the method of valuation was reasonable in all the circumstances;

(c) that it appears to the valuer that there has been no material change in the value of the consideration in question since the valuation; and

(d) that on the basis of the valuation the value of the consideration, together with any cash by which the nominal value of the shares or any premium payable on them is to be paid up, is not less than so much of the aggregate of the nominal value and the whole of any such premium as is treated as paid up by the consideration and any such cash.

(7) Where the consideration to be valued is accepted partly in payment up of the nominal value of the shares and any premium and partly for some other consideration given by the company, Article 113 (and, where applicable, Article 54) and the foregoing provisions of this Article apply as if references to the consideration accepted by the company included the proportion of that consideration which is properly attributable to the payment up of that value and any premium; and—

(a) the valuer shall carry out, or arrange for, such other valuations as will enable him to determine that proportion; and

(b) his report shall state what valuations have been made under this paragraph and also the reason for, and method and date of, any such valuation and any other matters which may be relevant to that determination.

Valuation and report (Article 114) N.I.

119.—(1) Article 118(1) to (3) and (5) applies also as respects the valuation and report for the purposes of Article 114.

(2) The valuer's report for those purposes shall—

(a) state the consideration to be received by the company, describing the asset in question (specifying the amount to be received in cash) and the consideration to be given by the company (specifying the amount to be given in cash);

(b) state the method and date of valuation;

(c) contain or be accompanied by a note as to the matters mentioned in Article 118(6)(a) to (c); and

(d) contain or be accompanied by a note that on the basis of the valuation the value of the consideration to be received by the company is not less than the value of the consideration to be given by it.

(3) A reference in Article 114 or this Article to consideration given for the transfer of an asset includes consideration given partly for its transfer; but—

(a) the value of any consideration partly so given is to be taken as the proportion of the consideration properly attributable to its transfer;

(b) the valuer shall carry out or arrange for such valuations of anything else as will enable him to determine that proportion; and

(c) his report for the purposes of Article 114 shall state what valuation has been made under this paragraph and also the reason for, and method and date of, any such valuation and any other matters which may be relevant to that determination.

Entitlement of valuer to full disclosure N.I.

120.—(1) A person carrying out a valuation or making a report under Article 113 or 114, with respect to any consideration proposed to be accepted or given by a company, is entitled to require from the officers of the company such information and explanation as he thinks necessary to enable him to carry out the valuation or make the report and provide a note under Article 118(6) or (as the case may be) Article 119(2)(c).

(2) A person who knowingly or recklessly makes a statement which—

(a) is misleading, false or deceptive in a material particular, and

(b) is a statement to which this paragraph applies,

is guilty of an offence and liable to imprisonment or a fine, or both.

(3) Paragraph (2) applies to any statement made (whether orally or in writing) to a person carrying out a valuation or making a report under Article 118 or 119, being a statement which conveys or purports to convey any information or explanation which that person requires, or is entitled to require, under paragraph (1).

Matters to be communicated to registrar N.I.

121.—(1) A company to which a report is made under Article 118 as to the value of any consideration for which, or partly for which, it proposes to allot shares shall deliver a copy of the report to the registrar for registration at the same time that it files the return of the allotments of those shares under Article 98.

(2) A company which has passed a resolution under Article 114 with respect to the transfer of an asset shall, within 15 days of so doing, deliver to the registrar a copy of the resolution together with the valuer's report required by that Article.

(3) If default is made in complying with paragraph (1), every officer of the company who is in default is liable to a fine and, for continued contravention, to a daily default fine; but this is subject to the same exception as is made by Article 98(6) (relief on application to the court) in the case of default in complying with that Article.

(4) If a company fails to comply with paragraph (2), it and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

Other matters arising out of allotment, etc.F1029 N.I.

[F137 Right to damages, etc. not affected N.I.

121A.   A person is not debarred from obtaining damages or other compensation from a company by reason only of his holding or having held shares in the company or any right to apply or subscribe for shares or to be included in the company's register in respect of shares.]

F137 1990 NI 10, art. 66(1)

Liability of subsequent holders of shares allotted N.I.

122.—(1) If a person becomes a holder of shares in respect of which—

(a) there has been a contravention of Article 109, 110, 111 or 113; and

(b) by virtue of that contravention, another is liable to pay any amount under the Article contravened,

that person is also liable to pay that amount (jointly and severally with any other person so liable), unless he is exempted from liability by paragraph (3).

(2) If a company enters into an agreement in contravention of Article 114 and—

(a) the agreement is or includes an agreement for the allotment of shares in the company; and

(b) a person becomes a holder of shares allotted under the agreement; and

(c) by virtue of the agreement and allotment under it, another person is liable to pay any amount under Article 115,

the person who becomes the holder of the shares is also liable to pay that amount (jointly and severally with any other person so liable), unless he is exempted from liability by paragraph (3); and this applies whether or not the agreement also contravenes Article 113.

(3) A person otherwise liable under paragraph (1) or (2) is exempted from that liability if either—

(a) he is a purchaser for value and, at the time of the purchase, he did not have actual notice of the contravention concerned; or

(b) he derived title to the shares (directly or indirectly) from a person who became a holder of them after the contravention and was not liable under paragraph (1) or (as the case may be) paragraph (2).

(4) References in this Article to a holder, in relation to shares in a company, include any person who has an unconditional right to be included in the company's register of members in respect of those shares or to have an instrument of transfer of the shares executed in his favour.

(5) As paragraphs (1) and (3) apply in relation to the contraventions there mentioned, they also apply—

(a) to a contravention of Article 112; and

(b) to a failure to carry out a term of contract as mentioned in paragraphs (5) and (6) of that Article.

Relief in respect of certain liabilities under Articles 109ff. N.I.

123.—(1) Where a person is liable to a company under—

(a) Article 109, 112, 113 or 115;

(b) Article 122(1) by reference to a contravention of Article 109 or 113; or

(c) Article 122(2) or (5),

in relation to payment in respect of any shares in the company, or is liable by virtue of an undertaking given to it in, or in connection with, payment for any such shares, the person so liable may make an application to the court to be exempted in whole or in part from the liability.

(2) If the liability mentioned in paragraph (1) arises in relation to payment in respect of any shares, the court may, on an application under that paragraph, exempt the applicant from the liability only—

(a) if and to the extent that it appears to the court just and equitable to do so having regard to the matters mentioned in paragraph (3);

(b) if and to the extent that it appears to the court just and equitable to do so in respect of any interest which he is liable to pay to the company under any of the relevant Articles.

(3) The matters to be taken into account by the court under paragraph (2)(a) are—

(a) whether the applicant has paid, or is liable to pay, any amount in respect of any other liability arising in relation to those shares under any of the relevant Articles, or of any liability arising by virtue of any undertaking given in or in connection with a payment for those shares;

(b) whether any person other than the applicant has paid or is likely to pay (whether in pursuance of an order of the court or otherwise) any such amount; and

(c) whether the applicant or any other person has performed in whole or in part, or is likely so to perform, any such undertaking, or has done or is likely to do any other thing in payment or part payment for the shares.

(4) Where the liability arises by virtue of an undertaking given to the company in, or in connection with, payment for shares in it, the court may, on an application under paragraph (1), exempt the applicant from the liability only if and to the extent that it appears to the court just and equitable to do so having regard to—

(a) whether the applicant has paid or is liable to pay any amount in respect of liability arising in relation to the shares under any of the provisions mentioned in that paragraph; and

(b) whether any person other than the applicant has paid or is likely to pay (whether in pursuance of an order of the court or otherwise) any such amount.

(5) In determining whether it should exempt the applicant in whole or in part from any liability, the court shall have regard to the following overriding principles, namely—

(a) that a company which has allotted shares should receive money or money's worth at least equal in value to the aggregate of the nominal value of those shares and the whole of any premium or, if the case so requires, so much of that aggregate as is treated as paid up; and

(b) subject to this, that where such a company would, if the court did not grant the exemption, have more than one remedy against a particular person, it should be for the company to decide which remedy it should remain entitled to pursue.

(6) If a person brings proceedings against another ( “the contributor”) for a contribution in respect of liability to a company arising under any of Articles 109 to 115 or 122 and it appears to the court that the contributor is liable to make such a contribution, the court may exercise the powers of paragraph (7).

(7) The court may, if and to the extent that it appears to it, having regard to the respective culpability (in respect of the liability to the company) of the contributor and the person bringing the proceedings, that it is just and equitable to do so—

(a) exempt the contributor in whole or in part from his liability to make such a contribution; or

(b) order the contributor to make a larger contribution than, but for this paragraph, he would be liable to make.

(8) Where a person is liable to a company under paragraph (2) of Article 115, the court may, on application, exempt him in whole or in part from that liability if and to the extent that it appears to the court just and equitable to do so having regard to any benefit accruing to the company by virtue of anything done by him towards the carrying out of the agreement mentioned in that paragraph.

Penalty for contravention N.I.

124.  If a company contravenes any of the provisions of Articles 109 to 114 and 116 the company and any officer of it who is in default is liable to a fine.

Undertakings to do work, etc. N.I.

125.—(1) Subject to Article 123, an undertaking given by any person, in or in connection with payment for shares in a company, to do work or perform services or to do any other thing, if it is enforceable by the company apart from this Order, is so enforceable notwithstanding that there has been a contravention in relation to it of Article 109, 112 or 113.

(2) Where such an undertaking is given in contravention of Article 114 in respect of the allotment of shares, it is so enforceable notwithstanding the contravention.

Application of Articles 109ff. to special cases N.I.

126.  Except as provided by Article 11 of the Consequential Provisions Order (transitional cases dealt with by Article 33 of the Order of 1981), Articles 109, 111 to 113, 116, 118 [F138 , 120, 121 and 122 to 125] apply—

(a) to a company which has passed and not revoked a resolution to be re-registered under Article 53 as a public company, and

(b) to a joint stock company which has passed, and not revoked, a resolution that the company be a public company,

as those Articles apply to a public company.

F138 1990 NI 10

PART VIF1029 N.I. SHARE CAPITAL, ITS INCREASE, MAINTENANCE AND REDUCTION

CHAPTER IF1029 N.I. GENERAL PROVISIONS ABOUT SHARE CAPITAL

Public company share capital requirements N.I.

127.—(1) A company registered as a public company on its original incorporation shall not do business or exercise any borrowing powers unless the registrar has issued it with a certificate under this Article or the company is re-registered as a private company.

(2) The registrar shall issue a company with such a certificate if, on an application made to him by the company in the prescribed form, he is satisfied that the nominal value of the company's allotted share capital is not less than the authorised minimum, and there is delivered to him a statutory declaration complying with paragraph (3)[F139 This paragraph is subject to paragraph (3A)].

(3) The statutory declaration must be in the prescribed form and be signed by a director or secretary of the company; and it must—

(a) state that the nominal value of the company's allotted share capital is not less than the authorised minimum;

(b) specify the amount paid up, at the time of the application, on the allotted share capital of the company;

(c) specify the amount, or estimated amount, of the company's preliminary expenses and the persons by whom any of those expenses have been paid or are payable; and

(d) specify any amount or benefit paid or given, or intended to be paid or given, to any promoter of the company, and the consideration for the payment or benefit.

[F139 (3A) In place of the statutory declaration referred to in paragraph (2), there may be delivered to the registrar using electronic communications a statement made by a director or secretary of the company complying with the requirements of paragraph (3)(a) to (d).]

(4) For the purposes of paragraph (2), a share allotted in pursuance of an employees' share scheme may not be taken into account in determining the nominal value of the company's allotted share capital unless it is paid up at least as to one-quarter of the nominal value of the share and the whole of any premium on the share.

(5) The registrar may accept a statutory declaration[F139 or statement] delivered to him under this Article as sufficient evidence of the matters stated in it.

(6) A certificate under this Article in respect of a company is conclusive evidence that the company is entitled to do business and exercise any borrowing powers.

(7) If a company does business or exercises borrowing powers in contravention of this Article, the company and any officer of it who is in default is liable to a fine.

[F139 (7A) Any person who makes a false statement under paragraph (3A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

(8) Nothing in this Article affects the validity of any transaction entered into by a company; but, if a company enters into a transaction in contravention of this Article and fails to comply with its obligations in that connection within 21 days from being called upon to do so, the directors of the company are jointly and severally liable to indemnify the other party to the transaction in respect of any loss or damage suffered by him by reason of the company's failure to comply with those obligations.

F139 SR 2003/3

The authorised minimum N.I.

128.—(1) In this Order, “the authorised minimum” means £50,000, or such other sum as the Department may by order specify.

(2) An order under this Article which increases the authorised minimum may—

(a) require any public company having an allotted share capital of which the nominal value is less than the amount specified in the order as the authorised minimum to increase that value to not less than that amount or make application to be re-registered as a private company;

(b) make, in connection with any such requirement, provision for any of the matters for which provision is made by this Order relating to a company's registration, re-registration or change of name, to payment for any share comprised in a company's capital and to offers of shares in or debentures of a company to the public, including provision as to the consequences (whether in criminal law or otherwise) of a failure to comply with any requirement of the order; and

(c) contain such supplemental and transitional provisions as the Department thinks appropriate.

(3) An order shall not be made under this Article unless a draft of it has been laid before, and approved by a resolution of, the Assembly.

Provision for different amounts to be paid on shares N.I.

129.  A company, if so authorised by its articles, may do any one or more of the following things—

(a) make arrangements on the issue of shares for a difference between the shareholders in the amounts and times of payment of calls on their shares;

(b) accept from any member the whole or a part of the amount remaining unpaid on any shares held by him, although no part of that amount has been called up;

(c) pay dividend in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others.

Reserve liability of limited company N.I.

130.  A limited company may by special resolution determine that any portion of its share capital which has not been already called up shall not be capable of being called up except in the event and for the purposes of the company being wound up; and that portion of its share capital is then not capable of being called up except in that event and for those purposes.

Alteration of share capital (limited companies) N.I.

131.—(1) A company limited by shares or a company limited by guarantee and having a share capital, if so authorised by its articles, may alter the conditions of its memorandum in any of the following ways.

(2) The company may—

(a) increase its share capital by new shares of such amount as it thinks expedient;

(b) consolidate and divide all or any of its share capital into shares of larger amount than its existing shares;

(c) convert all or any of its paid-up shares into stock, and re-convert that stock into paid-up shares of any denomination;

(d) sub-divide its shares, or any of them, into shares of smaller amount than is fixed by the memorandum (but subject to paragraph (3));

(e) cancel shares which, at the date of the passing of the resolution to cancel them, have not been taken or agreed to be taken by any person, and diminish the amount of the company's share capital by the amount of the shares so cancelled.

(3) In any sub-division under paragraph (2)(d) the proportion between the amount paid and the amount, if any, unpaid on each reduced share must be the same as it was in the case of the share from which the reduced share is derived.

(4) The powers conferred by this Article must be exercised by the company in general meeting.

(5) A cancellation of shares under this Article does not for the purposes of this Order constitute a reduction of share capital.

Notice to registrar of alteration N.I.

132.—(1) If a company having a share capital has—

(a) consolidated and divided its share capital into shares of larger amount than its existing shares; or

(b) converted any shares into stock; or

(c) re-converted stock into shares; or

(d) sub-divided its shares or any of them; or

(e) redeemed any redeemable shares; or

(f) cancelled any shares (otherwise than in connection with a reduction of share capital under Article 145);

it shall within one month after so doing give notice in the prescribed form to the registrar, specifying (as the case may be) the shares consolidated, divided, converted, sub-divided, redeemed or cancelled, or the stock re-converted.

(2) If default is made in complying with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

Notice to registrar of increased share capital N.I.

133.—(1) If a company having a share capital (whether or not its shares have been converted into stock) increases its share capital beyond the registered capital, it shall, within 15 days after the passing of the resolution authorising the increase, give to the registrar notice in the prescribed form of the increase, and the registrar shall record the increase.

(2) The notice must include such particulars as may be prescribed with respect to the classes of shares affected and the conditions subject to which the new shares have been or are to be issued.

(3) There shall be forwarded to the registrar together with the notice a printed copy of the resolution authorising the increase, or a copy of the resolution in some other form approved by the registrar.

(4) If default is made in complying with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

Reserve capital of unlimited company N.I.

134.  An unlimited company having a share capital may by its resolution for re-registration as a public company under Article 53, or as a limited company under Article 61—

(a) increase the nominal amount of its share capital by increasing the nominal amount of each of its shares (but subject to the condition that no part of the increased capital is to be capable of being called up except in the event and for the purpose of the company being wound up), and

(b) alternatively or in addition, provide that a specified portion of its uncalled share capital is not to be capable of being called up except in that event and for that purpose.

CHAPTER IIF1029 N.I. CLASS RIGHTS

Variation of class rights N.I.

135.— [F140 (1) This Article is concerned with the variation of the rights attached to any class of shares in a company whose share capital is divided into shares of different classes.

(2) Where the rights are attached to a class of shares otherwise than by the company's memorandum, and the company's articles do not contain provision with respect to the variation of the rights, those rights may be varied if, but only if—

(a) the holders of three-quarters in nominal value of the issued shares of that class[F141 (excluding any shares of that class held as treasury shares)] consent in writing to the variation; or

(b) [F142 a special resolution] passed at a separate general meeting of the holders of that class sanctions the variation;

and any requirement (howsoever imposed) in relation to the variation of those rights is complied with to the extent that it is not comprised in sub-paragraphs (a) and (b).

(3) Where—

(a) the rights are attached to a class of shares by the memorandum or otherwise;

(b) the memorandum or articles contain provision for the variation of those rights; and

(c) the variation of those rights is connected with the giving, variation, revocation or renewal of an authority for allotment under Article 90 or with a reduction of the company's share capital under Article 145;

those rights shall not be varied unless—

(i) the condition mentioned in paragraph (2)(a) or (b) is satisfied; and

(ii) any requirement of the memorandum or articles in relation to the variation of rights of that class is complied with to the extent that it is not comprised in that condition.

(4) If the rights are attached to a class of shares in the company by the memorandum or otherwise and—

(a) where they are so attached by the memorandum, its articles contain provision with respect to their variation which had been included in the articles at the time of the company's original incorporation; or

(b) where they are so attached otherwise, its articles contain such provision (whenever first so included),

and in either case the variation is not connected as mentioned in paragraph (3)(c), those rights may only be varied in accordance with that provision of the company's articles.

(5) If the rights are attached to a class of shares by the memorandum, and the memorandum and articles do not contain provision with respect to the variation of those rights, those rights may be varied if all the members of the company[F141 (excluding any member holding shares as treasury shares)] agree to the variation.

(6) The provisions of Article 377 (length of notice for calling company meetings), Article 378 (general provisions as to meetings and votes), and Articles 384 and 385 (circulation of members' resolutions) and the provisions of the company's articles relating to general meetings shall, so far as applicable, apply in relation to any meeting of shareholders required by this Article or otherwise to take place in connection with the variation of the rights attached to a class of shares, and shall so apply with the necessary modifications and subject to the following provisions, namely—

(a) the necessary quorum at any such meeting other than an adjourned meeting shall be 2 persons holding or representing by proxy at least one-third in nominal value of the issued shares of the class in question[F141 (excluding any shares of that class held as treasury shares)] and at an adjourned meeting one person holding shares of the class in question or his proxy;

(b) any holder of shares of the class in question present in person or by proxy may demand a poll.

(7) Any alteration of a provision contained in a company's articles for the variation of the rights attached to a class of shares, or the insertion of any such provision into its articles, is itself to be treated as a variation of those rights.

(8) In this Article and (except where the context otherwise requires) in any provision for the variation of the rights attached to a class of shares contained in a company's memorandum or articles, references to the variation of those rights are to be read as including references to their abrogation.]

F140 Art. 135 repealed (1.10.2007 for art. 135(6) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 31)

F141 SR 2004/275

F142 Words in art. 135(2) substituted (1.10.2007 with application as mentioned in Sch. 4 para. 18(2) of the amending Order) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 18(1) (with art. 12)

Saving for court's powers under other provisions N.I.

136.  Nothing in Article 135(2) to (5) derogates from the powers of the court under the following Articles, namely—

• Articles 15 to 17 (company resolution to alter objects),

• Article 64 (litigated objection to public company becoming private by re-registration),

• Article 418 (court control of company compromising with creditors and members),

• Article 420 (company reconstruction or amalgamation),

• [F143 Part 30 of the Companies Act 2006 (protection of members against unfair prejudice)].

F143 Words in art. 136 substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 2007 (S.I. 2007/2194), arts. 1(3), 10(1), {Sch. 4 para. 25} (with art. 12)

Shareholders' right to object to variation N.I.

137.—(1) This Article applies if, in the case of a company whose share capital is divided into different classes of shares—

(a) provision is made by its memorandum or articles for authorising the variation of the rights attached to any class of shares in the company, subject to—

(i) the consent of any specified proportion of the holders of the issued shares of that class, or

(ii) the sanction of a resolution passed at a separate meeting of the holders of those shares,

and in pursuance of that provision the rights attached to any such class of shares are at any time varied; or

(b) the rights attached to any class of shares in the company are varied under Article 135(2).

(2) The holders of not less in the aggregate than 15 per cent. of the issued shares of the class in question (being persons who did not consent to or vote in favour of the resolution for the variation), may apply to the court to have the variation cancelled; and if such an application is made, the variation has no effect unless and until it is confirmed by the court.

[F144 (2A) For the purposes of paragraph (2), any of the company's issued share capital held as treasury shares must be disregarded.]

(3) Application to the court must be made within 21 days after the date on which the consent was given or the resolution was passed (as the case may be), and may be made on behalf of the shareholders entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.

(4) The court, after hearing the applicant and any other persons who apply to the court to be heard and appear to the court to be interested in the application, may, if satisfied having regard to all the circumstances of the case, that the variation would unfairly prejudice the shareholders of the class represented by the applicant, disallow the variation and shall, if not so satisfied, confirm it.

The decision of the court on any such application is final.

(5) The company shall within 15 days after the making of an order by the court on such an application forward an office copy of the order to the registrar; and, if default is made in complying with this provision, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(6) “Variation”, in this Article, includes abrogation.

F144 SR 2004/275

Registration of particulars of special rights N.I.

138.—(1) If a company allots shares with rights which are not stated in its memorandum or articles, or in any resolution or agreement which is required by [F145 section 30 of the Companies Act 2006] to be sent to the registrar, the company shall deliver to the registrar within one month from allotting the shares a statement in the prescribed form containing particulars of those rights.

(2) This does not apply if the shares are in all respects uniform with shares previously allotted; and shares are not for this purpose to be treated as different from shares previously allotted by reason only that the former do not carry the same rights to dividends as the latter during the 12 months immediately following the former's allotment.

(3) Where the rights attached to any shares of a company are varied otherwise than by an amendment of the company's memorandum or articles or by a resolution or agreement subject to Article 388, the company shall within one month from the date on which the variation is made deliver to the registrar a statement in the prescribed form containing particulars of the variation.

(4) Where a company (otherwise than by any such amendment, resolution or agreement as is mentioned in paragraph (3)) assigns a name or other designation, or a new name or other designation, to any class of its shares, it shall within one month from doing so deliver to the registrar a notice in the prescribed form giving particulars of the name or designation so assigned.

(5) If a company fails to comply with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F145 Words in art. 138(1) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(4) (with art. 12)

Registration of newly created class rights N.I.

139.—(1) If a company not having a share capital creates a class of members with rights which are not stated in its memorandum or articles or in a resolution or agreement to which [F146 section 30 of the Companies Act 2006] applies, the company shall deliver to the registrar within one month from the date on which the new class is created a statement in the prescribed form containing particulars of the rights attached to that class.

(2) If the rights of any class of members of the company are varied otherwise than by an amendment of the memorandum or articles or by a resolution or agreement subject to Article 388, the company shall within one month from the date on which the variation is made deliver to the registrar a statement in the prescribed form containing particulars of the variation.

(3) If a company (otherwise than by such an amendment, resolution or agreement as is mentioned in paragraph (2)) assigns a name or other designation, or a new name or other designation, to any class of its members, it shall within one month from doing so deliver to the registrar a notice in the prescribed form giving particulars of the name or designation so assigned.

(4) If a company fails to comply with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F146 Words in art. 139(1) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(5) (with art. 12)

CHAPTER IIIF1029 N.I. SHARE PREMIUMS

Appication of share premiums N.I.

140.—(1) If a company issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those shares shall be transferred to an account called “the share premium account”.

(2) The share premium account may be applied by the company in paying up unissued shares to be allotted to members as fully paid bonus shares, or in writing off—

(a) the company's preliminary expenses; or

(b) the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company,

or in providing for the premium payable on redemption or debentures of the company.

(3) Subject to this, the provisions of this Order relating to the reduction of a company's share capital apply as if the share premium account were part of its paid-up share capital.

(4) Articles 141 and 142 give relief from the requirements of this Article, and in those Articles references to the issuing company are to the company issuing shares as mentioned in paragraph (1).

Merger relief N.I.

141.—(1) With the exception made by Article 142(8) (group reconstruction) this Article applies where the issuing company has secured at least a 90 per cent. equity holding in another company in pursuance of an arrangement providing for the allotment of equity shares in the issuing company on terms that the consideration for the shares allotted is to be provided—

(a) by the issue or transfer to the issuing company of equity shares in the other company, or

(b) by the cancellation of any such shares not held by the issuing company.

(2) If the equity shares in the issuing company allotted in pursuance of the arrangement in consideration for the acquisition or cancellation of equity shares in the other company are issued at a premium, Article 140 does not apply to the premiums on those shares.

(3) Where the arrangement also provides for the allotment of any shares in the issuing company on terms that the consideration for those shares is to be provided by the issue or transfer to the issuing company of non-equity shares in the other company or by the cancellation of any such shares in that company not held by the issuing company, relief under paragraph (2) extends to any shares in the issuing company allotted on those terms in pursuance of the arrangement.

(4) Subject to paragraph (5), the issuing company is to be regarded for the purposes of this Article as having secured at least a 90 per cent. equity holding in another company in pursuance of such an arrangement as is mentioned in paragraph (1) if in consequence of an acquisition or cancellation of equity shares in that company (in pursuance of that arrangement) it holds equity shares in that company (whether all or any of those shares were acquired in pursuance of that arrangement or not) of an aggregate nominal value equal to 90 per cent. or more of the nominal value of that company's equity share capital[F147 (excluding any shares in that company held as treasury shares)].

(5) Where the equity share capital of the other company is divided into different classes of shares, this Article does not apply unless the requirements of paragraph (1) are satisfied in relation to each of those classes of shares taken separately.

(6) Shares held by a company which is the issuing company's holding company or subsidiary, or a subsidiary of the issuing company's holding company, or by its or their nominees, are to be regarded for the purposes of this Article as held by the issuing company.

(7) In relation to a company and its shares and capital, the following definitions apply for the purposes of this Article—

(a) “equity shares” means shares comprised in the company's equity share capital;

(b) “non-equity shares” means shares (of any class) not so comprised;

and “arrangement” means any agreement, scheme or arrangement (including an arrangement sanctioned under Article 418 (company compromise with creditors and members) or[F148 Article 96 of the Insolvency Order] (liquidator accepting shares, etc. as consideration for sale of company property)).

(8) The relief allowed by this Article does not apply if the issue of shares took place before 4th February 1981.

F147 SR 2004/275

F148 1989 NI 19

Relief in respect of group reconstructions N.I.

142.—(1) This Article applies where the issuing company—

(a) is a wholly-owned subsidiary of another company ( “the holding company”), and

(b) allots shares to the holding company or to another wholly-owned subsidiary of the holding company in consideration for the transfer to the issuing company of assets other than cash, being assets of any company ( “the transferor company”) which is a member of the group of companies which comprises the holding company and all its wholly-owned subsidiaries.

(2) Where the shares in the issuing company allotted in consideration for the transfer are issued at a premium, the issuing company is not required by Article 140 to transfer any account in excess of the minimum premium value to the share premium account.

(3) In paragraph (2), “the minimum premium value” means the amount (if any) by which the base value of the consideration for the shares allotted exceeds the aggregate nominal value of those shares.

(4) For the purposes of paragraph (3), the base value of the consideration for the shares allotted is the amount by which the base value of the assets transferred exceeds the base value of any liabilities of the transferor company assumed by the issuing company as part of the consideration for the assets transferred.

(5) For the purposes of paragraph (4)—

(a) the base value of the assets transferred is to be taken as—

(i) the cost of those assets to the transferor company, or

(ii) the amount at which those assets are stated in the transferor company's accounting records immediately before the transfer,

whichever is the less; and

(b) the base value of the liabilities assumed is to be taken as the amount at which they are stated in the transferor company's accounting records immediately before the transfer.

(6) The relief allowed by this Article does not apply (subject to paragraph (7)) if the issue of shares took place before the date of the coming into operation of this Article.

(7) To the extent that the relief allowed by this Article would have been allowed by Article 39 of the Order of 1982 as originally enacted (the text of which Article is set out in Schedule 24), the relief applies where the issue of shares took place before the date of the coming into operation of this Article, but not if it took place before 4th February 1981.

(8) Article 141 does not apply in a case falling within this Article.

Provisions supplementing Articles 141 and 142 N.I.

143.—(1) An amount corresponding to one representing the premiums or part of the premiums on shares issued by a company which by virtue of Article 141 or 142 of this Order or Article 14 of the Consequential Provisions Order is not included in the company's share premium account may also be disregarded in determining the amount at which any shares or other consideration provided for the shares issued is to be included in the company's balance sheet.

(2) References in this Chapter (however expressed) to—

(a) the acquisition by a company of shares in another company; and

(b) the issue or allotment of shares to, or the transfer of shares to or by, a company,

include (respectively) the acquisition of any of those shares by, and the issue or allotment or (as the case may be) the transfer of any of those shares to or by, nominees of that company; and the references in Article 142 to the company transferring the shares is to be construed accordingly.

(3) References in this Chapter to the transfer of shares in a company include the transfer of a right to be included in the company's register of members in respect of those shares.

(4) In Articles 141, 142 and this Article “company”, except in references to the issuing company, includes any body corporate.

Provision for extending or restricting relief from Article 140 N.I.

144.—(1) The Department may by regulations make such provision as appears to it to be appropriate—

(a) for relieving companies from the requirements of Article 140 in relation to premiums other than cash premiums, or

(b) for restricting or otherwise modifying any relief from those requirements provided by this Chapter.

(2) No such regulations shall be made unless a draft of the regulations has been laid before, and approved by a resolution of, the Assembly.

CHAPTER IVF1029 N.I. REDUCTION OF SHARE CAPITAL

Special resolution for reduction of share capital N.I.

145.—(1) Subject to confirmation by the court, a company limited by shares or a company limited by guarantee and having a share capital may, if so authorised by its articles, by special resolution reduce its share capital in any way.

(2) In particular, and without prejudice to paragraph (1), the company may—

(a) extinguish or reduce the liability on any of its shares in respect of share capital not paid up; or

(b) either with or without extinguishing or reducing liability on any of its shares, cancel any paid-up share capital which is lost or unrepresented by available assets; or

(c) either with or without extinguishing or reducing liability on any of its shares, pay off any paid-up share capital which is in excess of the company's wants;

and the company may, if and so far as is necessary, alter its memorandum by reducing the amount of its share capital and of its shares accordingly.

(3) A special resolution under this Article is in this Order referred to as “a resolution for reducing share capital”.

Application to court for order of confirmation N.I.

146.—(1) Where a company has passed a resolution for reducing share capital, it may apply to the court for an order confirming the reduction.

(2) If the proposed reduction of share capital involves either—

(a) diminution of liability in respect of unpaid share capital; or

(b) the payment to a shareholder of any paid-up share capital,

and in any other case if the court so directs, paragraphs (3) to (5) shall have effect, but subject throughout to paragraph (6).

(3) Every creditor of the company who at the date fixed by the court is entitled to any debt or claim which, if that date were the commencement of the winding up of the company, would be admissible in proof against the company, is entitled to object to the reduction of capital.

(4) The court shall settle a list of creditors entitled to object, and for that purpose—

(a) shall ascertain, as far as possible without requiring an application from any creditor, the names of those creditors and the nature and amount of their debts or claims; and

(b) may publish notices fixing a day or days within which creditors not entered on the list are to claim to be so entered or are to be excluded from the right of objecting to the reduction of capital.

(5) If a creditor entered on the list whose debt or claim is not discharged or has not determined does not consent to the reduction, the court may, if it thinks fit, dispense with the consent of that creditor, on the company securing payment of his debt or claim by appropriating (as the court may direct) the following amount—

(a) if the company admits the full amount of the debt or claim or, though not admitting it, is willing to provide for it, then the full amount of the debt or claim;

(b) if the company does not admit, and is not willing to provide for, the full amount of the debt or claim, or if the amount is contingent or not ascertained, then an amount fixed by the court after the like enquiry and adjudication as if the company were being wound up by the court.

(6) If a proposed reduction of share capital involves either the diminution of any liability in respect of unpaid share capital or the payment to any shareholder of any paid-up share capital, the court may, if having regard to any special circumstances of the case it thinks proper to do so, direct that paragraphs (3) to (5) shall not apply as regards any class or any classes or creditors.

Court order confirming reduction N.I.

147.—(1) The court, if satisfied with respect to every creditor of the company who under Article 146 is entitled to object to the reduction of capital that either—

(a) his consent to the reduction has been obtained; or

(b) his debt or claim has been discharged or has determined, or has been secured,

may make an order confirming the reduction on such terms and conditions as it thinks fit.

(2) Where the court so orders, it may also—

(a) if for any special reason it thinks proper to do so, make an order directing that the company shall, during such period (commencing on or at any time after the date of the order) as is specified in the order, add to its name as its last words the words “and reduced”; and

(b) make an order requiring the company to publish (as the court directs) the reasons for reduction of capital or such other information in regard to it as the court thinks expedient with a view to giving proper information to the public and (if the court thinks fit) the causes which led to the reduction.

(3) Where a company is ordered to add to its name the words “and reduced”, those words are, until the expiration of the period specified in the order, deemed to be part of the company's name.

Registration of order and minute of reduction N.I.

148.—(1) The registrar, on production to him of an order of the court confirming the reduction of a company's share capital, and the delivery to him of an office copy of the order and of a minute (approved by the court) showing, with respect to the company's share capital as altered by the order—

(a) the amount of the share capital;

(b) the number of shares into which it is to be divided, and the amount of each share; and

(c) the amount (if any) at the date of the registration deemed to be paid up on each share,

shall register the order and minute (but subject to Article 149).

(2) On the registration of the order and minute, and not before, the resolution for reducing share capital as confirmed by the order so registered takes effect.

(3) Notice of the registration shall be published in such manner as the court may direct.

(4) The registrar shall certify under his hand the registration of the order and minute; and the certificate is conclusive evidence that all the requirements of this Order with respect to the reduction of share capital have been complied with, and that the company's share capital is as stated in the minute.

(5) The minute when registered is deemed to be substituted for the corresponding part of the company's memorandum, and is valid and alterable as if it had been originally contained therein.

(6) The substitution of such a minute for part of the company's memorandum is deemed an alteration of the memorandum for the purposes of Article 31.

Public company reducing capital below authorised minimum N.I.

149.—(1) This Article applies where the court makes an order confirming a reduction of a public company's capital which has the effect of bringing the nominal value of its allotted share capital below the authorised minimum.

(2) The registrar shall not register the order under Article 148 unless the court otherwise directs, or the company is first re-registered as a private company.

(3) The court may authorise the company to be so re-registered without its having passed the special resolution required by Article 63; and where that authority is given, the court shall specify in the order the alterations in the company's memorandum and articles to be made in connection with that re-registration.

(4) The company may then be re-registered as a private company, if an application in the prescribed form and signed by a director or secretary of the company is delivered to the registrar, together with a printed copy of the memorandum and articles as altered by the court's order.

(5) On receipt of such an application, the registrar shall retain it and the other documents delivered with it and issue the company with a certificate of incorporation appropriate to a company that is not a public company; and—

(a) the company by virtue of the issue of the certificate becomes a private company, and the alterations in the memorandum and articles set out in the court's order take effect; and

(b) the certificate is conclusive evidence that the requirements of this Article in respect of re-registration and of matters precedent and incidental thereto have been complied with, and that the company is a private company.

Liability of members on reduced shares N.I.

150.—(1) Where a company's share capital is reduced, a member of the company (past or present) is not liable in respect of any share to any call or contribution exceeding in amount the difference (if any) between the amount of the share as fixed by the minute and the amount paid on the share or the reduced amount (if any), which is deemed to have been paid on it, as the case may be.

(2) But paragraphs (3) and (4) apply if—

(a) a creditor, entitled in respect of a debt or claim to object to the reduction of share capital, by reason of his ignorance of the proceedings for reduction of share capital, or of their nature and effect with respect to his claim, is not entered on the list of creditors; and

(b) after the reduction of capital, the company is unable (within the meaning of[F149 Article 103 of the Insolvency Order]) to pay the amount of his debt or claim.

(3) Every person who was a member of the company at the date of the registration of the order for reduction and minute is then liable to contribute for the payment of the debt or claim in question an amount not exceeding that which he would have been liable to contribute if the company had commenced to be wound up on the day before that date.

(4) If the company is wound up, the court, on the application of the creditor in question and proof of ignorance referred to in paragraph (2)(a), may (if it thinks fit) settle accordingly a list of persons so liable to contribute, and make and enforce calls and orders on the contributories settled on the list, as if they were ordinary contributories in a winding up.

(5) Nothing in this Article affects the rights of the contributories among themselves.

F149 1989 NI 19

Penalty for concealing name of creditor, etc. N.I.

151.  If an officer of the company—

(a) wilfully conceals the name of a creditor entitled to object to the reduction of capital;

(b) wilfully misrepresents the nature or amount of the debt of claim of any creditor; or

(c) aids, abets or is privy to any such concealment or misrepresentation,

he is guilty of an offence and liable to a fine.

CHAPTER VF1029 N.I. MAINTENANCE OF CAPITAL

Duty of directors on serious loss of capital N.I.

152.—(1) Where the net assets of a public company are half or less of its called-up share capital, the directors shall, not later than 28 days from the earliest day on which that fact is known to a director of the company, duly convene an extraordinary general meeting of the company for a date not later than 56 days from that day for the purpose of considering whether any, and if so what, steps should be taken to deal with the situation.

(2) In paragraph (1), “net assets” means the aggregate of the company's assets less the aggregate of its liabilities ( “liabilities” to include any provision for liabilities or charges within paragraph 88 of Schedule 4).

(3) If there is a failure to convene an extraordinary general meeting as required by paragraph (1), each of the directors of the company who—

(a) knowingly and wilfully authorises or permits the failure, or

(b) after the expiry of the period during which that meeting should have been convened, knowingly and wilfully authorises or permits the failure to continue,

is liable to a fine.

(4) Nothing in this Article authorises the consideration, at a meeting convened in pursuance of paragraph (1), of any matter which could not have been considered at that meeting apart from this Article.

General rule against company acquiring own shares N.I.

153.—(1) Subject to the following provisions, a company limited by shares or limited by guarantee and having a share capital shall not acquire its own shares, whether by purchase, subscription or otherwise.

(2) If a company purports to act in contravention of this Article, the company is liable to a fine, and every officer of the company who is in default is liable to imprisonment or a fine, or both; and[F150 , subject to paragraph (2A),] the purported acquisition is void.

[F150 (2A) Where a company purchases qualifying shares out of distributable profits under Article 172, any contravention by the company of any provision of Article 172B(1) or (2) shall not render the acquisition void under paragraph (2).]

(3) A company limited by shares may acquire any of its own fully paid shares otherwise than for valuable consideration; and paragraph (1) does not apply in relation to—

(a) the redemption or purchase of shares in accordance with Chapter VII,

(b) the acquisition of shares in a reduction of capital duly made,

(c) the purchase of shares in pursuance of an order of the court under Article 16 (alteration of objects), Article 64 (litigated objection to resolution for company to be re-registered as private) or Part XVIII (relief to members unfairly prejudiced), or

(d) the forfeiture of shares, or the acceptance of shares surrendered in lieu, in pursuance of the company's articles, for failure to pay any sum payable in respect of the shares.

F150 SR 2004/275

Acquisition of shares by company's nominee N.I.

154.—(1) Subject to Article 155, where shares are issued to a nominee of a company mentioned in Article 153(1), or are acquired by a nominee of such a company from a third person as partly paid up, then, for all purposes—

(a) the shares are to be treated as held by the nominee on his own account; and

(b) the company is to be regarded as having no beneficial interest in them.

(2) Subject to that Article, if a person is called on to pay any amount for the purpose of paying up, or paying any premium on, any shares in such a company which were issued to him, or which he otherwise acquired, as the company's nominee and he fails to pay that amount within 21 days from being called on to do so, then—

(a) if the shares were issued to him as subscriber to the memorandum by virtue of an undertaking of his in the memorandum, the other subscribers to the memorandum, or

(b) if the shares were otherwise issued to or acquired by him, the directors of the company at the time of the issue or acquisition,

are jointly and severally liable with him to pay that amount.

(3) If in proceedings for the recovery of any such amount from any such subscriber or director under this Article it appears to the court—

(a) that he is or may be liable to pay that amount, but

(b) that he has acted honestly and reasonably and, having regard to all the circumstances of the case, he ought fairly to be excused from liability,

the court may relieve him, either wholly or partly, from his liability on such terms as the court thinks fit.

(4) Where any such subscriber or director has reason to apprehend that a claim will or might be made for the recovery of any such amount from him, he may apply to the court for relief; and the court has the same power to relieve him as it would have had in proceedings for the recovery of that amount.

Exceptions from Article 154 N.I.

155.—(1) Article 154(1) does not apply to shares acquired otherwise than by subscription by a nominee of a public company, where a person acquires shares in the company with financial assistance given to him directly or indirectly by the company for the purpose of or in connection with the acquisition and the company has a beneficial interest in the shares.

(2) Article 154(1) and (2) does not apply—

(a) to shares acquired by a nominee of a company when the company has no beneficial interest in those shares, or

(b) to shares issued in consequence of an application made before 1st July 1983, or transferred in pursuance of an agreement to acquire them made before that date.

(3) Schedule 2 has effect for the interpretation of references in this Article to a company having, or not having, a beneficial interest in shares.

Treatment of shares held by or for public company N.I.

156.—(1) Except as provided by Article 158, the following applies to a public company—

(a) where shares in the company are forfeited, or surrendered to the company in lieu, in pursuance of its articles, for failure to pay any sum payable in respect of the shares;

[F151 (aa) where shares in the company are surrendered to the company in pursuance of section 102C(1)(b) of the Building Societies Act 1986;]

(b) where shares in the company are acquired by it (otherwise than by any of the methods mentioned in Article 153 (3)(a) to (d)) and the company has a beneficial interest in the shares;

(c) where the nominee of the company acquires shares in the company from a third person without financial assistance being given directly or indirectly by the company and the company has a beneficial interest in the shares; or

(d) where a person acquires shares in the company with financial assistance given to him directly or indirectly by the company for the purpose of or in connection with the acquisition, and the company has a beneficial interest in the shares.

Schedule 2 has effect for the interpretation of references in this paragraph to the company having a beneficial interest in shares.

(2) Unless the shares or any interest of the company in them are previously disposed of, the company must, not later than the end of the relevant period from their forfeiture or surrender or, in a case within paragraph (1)(b), (c) or (d), their acquisition—

(a) cancel them and diminish the amount of the share capital by the nominal value of the shares cancelled; and

(b) where the effect of cancelling the shares will be that the nominal value of the company's allotted share capital is brought below the authorised minimum, apply for re-registration as a private company, stating the effect of the cancellation.

(3) For this purpose “the relevant period” is—

(a) 3 years in the case of shares forfeited or surrendered to the company in lieu of forfeiture, or acquired as mentioned in paragraph (1)(b) or (c);

(b) one year in the case of shares acquired as mentioned in paragraph (1)(d).

(4) The company and, in a case within paragraph (1)(c) or (d), the company's nominee or (as the case may be) the other shareholder must not exercise any voting rights in respect of the shares; and any purported exercise of those rights is void.

F151 1997 c. 41

Matters arising out of compliance with Article 156(2) N.I.

157.—(1) The directors may take such steps as are requisite to enable the company to carry out its obligations under Article 156(2) without complying with Articles 145 and 146 (resolution to reduce share capital; application to court for approval).

(2) The steps taken may include the passing of a resolution to alter the company's memorandum so that it no longer states that the company is to be a public company; and the resolution may make such other alterations in the memorandum as are requisite in the circumstances.

[F152 Chapter 3 of Part 3 of the Companies Act 2006 (resolutions affecting a company's constitution) applies to such a resolution.]

(3) The application for re-registration required by Article 156(2)(b) must be in the prescribed form and be signed by a director or secretary of the company, and must be delivered to the registrar together with a printed copy of the memorandum and articles of the company as altered by the resolution.

(4) If the registrar is satisfied that the company may be re-registered under Article 156, he shall retain the application and other documents delivered with it and issue the company with a certificate of incorporation appropriate to a company that is not a public company; and—

(a) the company by virtue of the issue of the certificate becomes a private company, and the alterations in the memorandum and articles set out in the resolution take effect accordingly, and

(b) the certificate is conclusive evidence that the requirements of Articles 156 to 158 in respect of re-registration and of matters precedent and incidental to it have been complied with, and that the company is a private company.

F152 Words in art. 157(2) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(6) (with art. 12)

Further provisions supplementing Articles 156 and 157 N.I.

158.—(1) Where, after shares in a private company—

(a) are forfeited in pursuance of the company's articles or are surrendered to the company in lieu of forfeiture, or

(b) are acquired by the company (otherwise than by such surrender or forfeiture, and otherwise than by any of the methods mentioned in Article 153(3)), the company having a beneficial interest in the shares, or

(c) are acquired by the nominee of a company in the circumstances mentioned in Article 156(1)(c), or

(d) are acquired by any person in the circumstances mentioned in Article 156(1)(d),

the company is re-registered as a public company, Articles 156 and 157, and also Article 159, apply to the company as if it had been a public company at the time of the forfeiture, surrender or acquisition, but with the modification required by paragraph (2).

(2) That modification is to treat any reference to the relevant period from the forfeiture, surrender or acquisition as referring to the relevant period from the re-registration of the company as a public company.

(3) Schedule 2 has effect for the interpretation of the reference in paragraph (1)(b) to the company having a beneficial interest in shares.

(4) Where a public company or a nominee of a public company acquires shares in the company or an interest in such shares, and those shares are or that interest is shown in a balance sheet of the company as an asset, an amount equal to the value of the shares or (as the case may be) the value to the company of its interest in them shall be transferred out of profits available for dividend to a reserve fund and shall not then be available for distribution.

Sanctions for non-compliance N.I.

159.—(1) If a public company required by paragraph (2) of Article 156 to apply to be re-registered as a private company fails to do so before the end of the relevant period referred to in that paragraph, Article 91 (restriction on public offers) applies to it as if it were a private company such as is mentioned in that Article; but, subject to this, the company continues to be treated for the purposes of this Order as a public company until it is so re-registered.

(2) If a company when required to do so by paragraph (2) of Article 156 (including that paragraph as applied by Article 158(1)) fails to cancel any shares in accordance with sub-paragraph (a) of that paragraph or to make an application for re-registration in accordance with sub-paragraph (b) of that paragraph, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

Charges of public companies on own shares N.I.

160.—(1) A lien or other charge of a public company on its own shares (whether taken expressly or otherwise), except a charge permitted by any of the following paragraphs, is void.

This is subject to Article 8 of the Consequential Provisions Order (saving for charges of old public companies on their own shares).

(2) In the case of any description of company, a charge on its own shares is permitted if the shares are not fully paid and the charge is for any amount payable in respect of the shares.

(3) In the case of a company whose ordinary business—

(a) includes the lending of money, or

(b) consists of the provision of credit or the bailment of goods under a hire purchase agreement, or both,

a charge of the company on its own shares is permitted (whether the shares are fully paid or not) if it arises in connection with a transaction entered into by the company in the ordinary course of its business.

(4) In the case of a company which is re-registered or is registered under Article 629 as a public company, a charge on its own shares is permitted if the charge was in existence immediately before the company's application for re-registration or (as the case may be) registration.

This paragraph does not apply in the case of such a company as is referred to in Article 8(3) of the Consequential Provisions Order (old public company remaining such after 31st December 1984 not having applied to be re-registered as a public company).

CHAPTER VIF1029 N.I. FINANCIAL ASSISTANCE BY A COMPANY FOR ACQUISITION OF ITS OWN SHARES

Provisions applying to both public and private companiesF1029 N.I.

Financial assistance generally prohibited N.I.

161.—(1) Subject to the following provisions of this Chapter, where a person is acquiring or is proposing to acquire shares in a company, it is not lawful for the company or any of its subsidiaries to give financial assistance directly or indirectly for the purpose of that acquisition before or at the same time as the acquisition takes place.

(2) Subject to those provisions, where a person has acquired shares in a company and any liability has been incurred (by that or any other person) for the purpose of that acquisition, it is not lawful for the company or any of its subsidiaries to give financial assistance directly or indirectly for the purpose of reducing or discharging the liability so incurred.

(3) If a company acts in contravention of this Article, it is liable to a fine, and every officer of it who is in default is liable to imprisonment or a fine, or both.

Interpretation for this Chapter N.I.

162.—(1) In this Chapter—

(a) “financial assistance” means—

(i) financial assistance given by way of gift;

(ii) financial assistance given by way of guarantee, security or indemnity, other than an indemnity in respect of the indemnifier's own neglect or default, or by way of release or waiver;

(iii) financial assistance given by way of a loan or any other agreement under which any of the obligations of the person giving the assistance are to be fulfilled at a time when in accordance with the agreement any obligation of another party to the agreement remains unfulfilled, or by way of the novation of, or the assignment of rights arising under a loan or such other agreement; or

(iv) any other financial assistance given by a company the net assets of which are thereby reduced to a material extent or which has no net assets;

(b) “distributable profits”, in relation to the giving of any financial assistance—

(i) means those profits out of which the company could lawfully make a distribution equal in value to that assistance, and

(ii) includes, in a case where the financial assistance is or includes a non-cash asset, any profit which, if the company were to make a distribution of that asset, would under Article 284 (distributions in kind) be available for that purpose, and

(c) “distribution” has the meaning given by Article 271(2).

(2) In paragraph (1)(a)(iv) “net assets” means the aggregate of the company's assets, less the aggregate of its liabilities ( “liabilities” to include any[F153 provision for liabilities] within paragraph 88 of Schedule 4[F153 that is made in Companies Order individual accounts and any provision that is made in IAS individual accounts] ).

(3) In this Chapter—

(a) a reference to a person incurring a liability includes his changing his financial position by making an agreement or arrangement (whether enforceable or unenforceable, and whether made on his own account or with any other person) or by any other means, and

(b) a reference to a company giving financial assistance for the purpose of reducing or discharging a liability incurred by a person for the purpose of the acquisition of shares includes its giving such assistance for the purpose of wholly or partly restoring his financial position to what it was before the acquisition took place.

F153 SR 2004/496

Transactions not prohibited by Article 161 N.I.

163.—(1) Article 161(1) does not prohibit a company from giving financial assistance for the purpose of an acquisition of shares in it or its holding company if—

(a) the company's principal purpose in giving that assistance is not to give it for the purpose of any such acquisition, or the giving of the assistance for that purpose is but an incidental part of some larger purpose of the company, and

(b) the assistance is given in good faith in the interests of the company.

(2) Article 161 (2) does not prohibit a company from giving financial assistance if—

(a) the company's principal purpose in giving the assistance is not to reduce or discharge any liability incurred by a person for the purpose of the acquisition of shares in the company or its holding company, or the reduction or discharge of any such liability is but an incidental part of some larger purpose of the company, and

(b) the assistance is given in good faith in the interests of the company.

(3) Article 161 does not prohibit—

(a) a distribution of a company's assets by way of dividend lawfully made or a distribution made in the course of the company's winding up,

(b) the allotment of bonus shares,

(c) a reduction of capital confirmed by order of the court under Article 147,

(d) a redemption or purchase of shares made in accordance with Chapter VII,

(e) anything done in pursuance of an order of the court under Article 418 (compromises and arrangements with creditors and members),

(f) anything done under an arrangement made in pursuance of[F154 Article 96 of the Insolvency Order] (acceptance of shares by liquidator in winding up as consideration for sale of property), or

(g) anything done under an arrangement made between a company and its creditors which is binding on the creditors by virtue of[F154 Part II of the Insolvency Order] (winding up imminent or in progress).

(4) Article 161 does not prohibit—

(a) where the lending of money is part of the ordinary business of the company, the lending of money by the company in the ordinary course of its business,

[F155 (b) the provision by a company, in good faith in the interests of the company, of financial assistance for the purposes of an employees' share scheme,]

[F156 (bb) without prejudice to sub-paragraph (b), the provision of financial assistance by a company or any of its subsidiaries for the purposes of or in connection with anything done by the company (or[F155 a company in the same group]) for the purpose of enabling or facilitating transactions in shares in the first-mentioned company between, and involving the acquisition of beneficial ownership of those shares by, any of the following persons—

(i) the bona fida employees or former employees of that company or of another company in the same group; or

(ii) the wives, husbands, widows, widowers, children, step-children or adopted children under the age of eighteen of such employees or former employees.]

(c) the making by a company of loans to persons (other than directors) employed in good faith by the company with a view to enabling those persons to acquire fully paid shares in the company or its holding company to be held by them by way of beneficial ownership.

[F155 (5) For the purposes of paragraph (4)(bb) a company is in the same group as another company if it is a holding company or subsidiary of that company, or a subsidiary of a holding company of that company.]

F154 1989 NI 19

F155 1990 NI 10

F156 1986 c. 60

Special restriction for public companies N.I.

164.—(1) In the case of a public company, Article 163(4) authorises the giving of financial assistance only if the company has net assets which are not thereby reduced or, to the extent that those assets are thereby reduced, if the assistance is provided out of distributable profits.

(2) For this purpose the following definitions apply—

(a) “net assets” means the amount by which the aggregate of the company's assets exceeds the aggregate of its liabilities (taking the amount of both assets and liabilities to be as stated in the company's accounting records immediately before the financial assistance is given);

(b) “liabilities” includes any amount retained as reasonably necessary for the purpose of providing for any liability[F157 the nature of which is clearly defined and] which is either likely to be incurred, or certain to be incurred, but uncertain as to amount or as to the date on which it will arise.

F157 SR 2004/496

Private companiesF1029 N.I.

Relaxation of Article 161 for private companies N.I.

165.—(1) Article 161 does not prohibit a private company from giving financial assistance in a case where the acquisition of shares in question is or was an acquisition of shares in the company or, if it is a subsidiary of another private company, in that other company if the following provisions of this Article, and Articles 166 to 168, are complied with as respects the giving of that assistance.

(2) The financial assistance may only be given if the company has net assets which are not thereby reduced or, to the extent that they are reduced, if the assistance is provided out of distributable profits.

Article 164(2) applies for the interpretation of this paragraph.

(3) This Article does not permit financial assistance to be given by a subsidiary in a case where the acquisition of shares in question is or was an acquisition of shares in its holding company, if it is also a subsidiary of a public company which is itself a subsidiary of that holding company.

(4) Unless the company proposing to give the financial assistance is a wholly-owned subsidiary, the giving of assistance under this Article must be approved by special resolution of the company in general meeting.

(5) Where the financial assistance is to be given by the company in a case where the acquisition of shares in question is or was an acquisition of shares in its holding company, that holding company and any other company which is both the company's holding company and a subsidiary of that other holding company (except, in any case, a company which is a wholly-owned subsidiary) shall also approve by special resolution in general meeting the giving of the financial assistance.

(6) The directors of the company proposing to give the financial assistance and, where the shares acquired or to be acquired are shares in its holding company, the directors of that company and of any other company which is both the company's holding company and a subsidiary of that other holding company shall before the financial assistance is given make a statutory declaration in the prescribed form complying with Article 166.

Statutory declaration under Article 165 N.I.

166.—(1) A statutory declaration made by a company's directors under Article 165(6) shall contain such particulars of the financial assistance to be given, and of the business of the company of which they are directors, as may be prescribed, and shall identify the person to whom the assistance is to be given.

(2) The declaration shall state that the directors have formed the opinion, as regards the company's initial situation immediately following the date on which the assistance is proposed to be given, that there will be no ground on which it could then be found to be unable to pay its debts; and either—

(a) if it is intended to commence the winding up of the company within 12 months of that date, the company will be able to pay its debts in full within 12 months of the commencement of the winding up, or

(b) in any other case, that the company will be able to pay its debts as they fall due during the year immediately following that date.

(3) In forming their opinion for the purposes of paragraph (2), the directors shall take into account the same liabilities (including contingent and prospective liabilities) as would be relevant under[F158 Article 102 of the Insolvency Order] (winding up by the court) to the question whether the company is unable to pay its debts.

(4) The directors' statutory declaration shall have annexed to it a report addressed to them by their company's auditors stating that—

(a) they have enquired into the state of affairs of the company, and

(b) they are not aware of anything to indicate that the opinion expressed by the directors in the declaration as to any of the matters mentioned in paragraph (2) is unreasonable in all the circumstances.

(5) The statutory declaration and auditors' report shall be delivered to the registrar—

(a) together with a copy of any special resolution passed by the company under Article 165 and delivered to the registrar in compliance with [F159 section 30 of the Companies Act 2006], or

(b) where no such resolution is required to be passed, within 15 days after the making of the declaration.

(6) If a company fails to comply with paragraph (5), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(7) A director of a company who makes a statutory declaration under Article 165 without having reasonable grounds for the opinion expressed in it is liable to imprisonment or a fine, or both.

F158 1989 NI 19

F159 Words in art. 166(5)(a) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(7) (with art. 12)

Special resolution under Article 165 N.I.

167.—(1) A special resolution required by Article 165 to be passed by a company approving the giving of financial assistance must be passed on the date on which the directors of that company make the statutory declaration required by that Article in connection with the giving of that assistance, or within the week immediately following that date.

(2) Where such a resolution has been passed, an application may be made to the court for the cancellation of the resolution—

(a) by the holders of not less in the aggregate than 10 per cent. in nominal value of the company's issued share capital or any class of it, or

(b) if the company is not limited by shares, by not less than 10 per cent. of the company's members;

but the application shall not be made by a person who has consented to or voted in favour of the resolution.

(3) Article 64(3) to (10) (litigation to cancel resolution under Article 63) applies to applications under this Article as to applications under Article 64.

(4) A special resolution passed by a company is not effective for the purposes of Article 165—

(a) unless the declaration made under paragraph (6) of that Article by the directors of the company, together with the auditors' report annexed to it, is available for inspection by members of the company at the meeting at which the resolution is passed,

(b) if it is cancelled by the court on an application under this Article.

Time for giving financial assistance under Article 165 N.I.

168.—(1) This Article applies as to the time before and after which financial assistance may not be given by a company in pursuance of Article 165.

(2) Where a special resolution is required by that Article to be passed approving the giving of the assistance, the assistance shall not be given before the expiry of the period of 4 weeks beginning with—

(a) the date on which the special resolution is passed, or

(b) where more than one such resolution is passed, the date on which the last of them is passed,

unless, as respects that resolution (or, if more than one, each of them) every member of the company which passed the resolution who is entitled to vote at general meetings of the company voted in favour of the resolution.

(3) If application for the cancellation of any such resolution is made under Article 167, the financial assistance shall not be given before the final determination of the application unless the court otherwise orders.

(4) The assistance shall not be given after the expiry of the period of 8 weeks beginning with—

(a) the date on which the directors of the company proposing to give the assistance made their statutory declaration under Article 165, or

(b) where that company is a subsidiary and both its directors and the directors of any of its holding companies made such a declaration, the date on which the earliest of the declarations is made,

unless the court, on an application under Article 167, otherwise orders.

CHAPTER VIIF1029 N.I. REDEEMABLE SHARES; PURCHASE BY A COMPANY OF ITS OWN SHARES

Redemption and purchase generallyF1029 N.I.

Power to issue redeemable shares N.I.

169 .F160 —(1) Subject to the provisions of this Chapter, a company limited by shares or limited by guarantee and having a share capital may, if authorised to do so by its articles, issue shares which are to be redeemed or are liable to be redeemed at the option of the company or the shareholder.

(2) No redeemable shares may be issued at a time when there are no issued shares of the company which are not redeemable.

(3) Redeemable shares may not be redeemed unless they are fully paid; and the terms of redemption must provide for payment on redemption.

F160 mod. by 1989 NI 19

Prospective

{prosp. insertion of art. 169A by 1990 NI10} N.I.

F161 Art 169A inserted (prosp.) by 1990 NI 10

Financing, etc. of redemption N.I.

170 .F162 —(1) Subject to paragraph (2) and to Articles 181 (private companies redeeming or purchasing own shares out of capital) and 188(4) (terms of redemption or purchase enforceable in a winding up)—

(a) redeemable shares may only be redeemed out of distributable profits of the company or out of the proceeds of a fresh issue of shares made for the purposes of the redemption; and

(b) any premium payable on redemption must be paid out of distributable profits of the company.

(2) If the redeemable shares were issued at a premium, any premium payable on their redemption may be paid out of the proceeds of a fresh issue of shares made for the purposes of the redemption, up to an amount equal to—

(a) the aggregate of the premiums received by the company on the issue of the shares redeemed, or

(b) the current amount of the company's share premium account (including any sum transferred to that account in respect of premiums on the new shares),

whichever is the less; and in that case the amount of the company's share premium account shall be reduced by a sum corresponding (or by sums in the aggregate corresponding) to the amount of any payment made by virtue of this paragraph out of the proceeds of the issue of the new shares.

F163 (3) Subject to the following provisions of this Chapter, redemption of shares may be effected on such terms and in such manner as may be provided by the company's articles.

(4) SharesF164 redeemed under this Article shall be treated as cancelled on redemption, and the amount of the company's issued share capital shall be diminished by the nominal value of those shares accordingly; but the redemption of shares by a company is not to be taken as reducing the amount of the company's authorised share capital.

(5) Without prejudice to paragraph (4), where a company is about to redeem shares, it has power to issue shares up to the nominal value of the shares to be redeemed as if those shares had never been issued.

F162 mod. by 1989 NI 19

F163 prosp. repeal by 1990 NI 10

F164 prosp. subst. by 1990 NI 10

Art. 171 rep. by 1988 c. 39

Power of company to purchase own shares N.I.

172 .F165 —(1) Subject to the following provisions of this Chapter, a company limited by shares or limited by guarantee and having a share capital may, if authorised to do so by its articles, purchase its own shares (including any redeemable shares).

[F166 (2) Articles 169 and 170 apply to the purchase by a company under this Article of its own shares as they apply to the redemption of redeemable shares.

This is subject to paragraphs (2A) and (2B).

(2A) The terms and manner of a purchase under this Article need not be determined by the Articles as required by Article 170(3).

(2B) Where a company makes a purchase of qualifying shares out of distributable profits under this Article, Article 172A applies to the shares purchased and accordingly Article 170(4) does not apply to those shares.]

(3) A company may not under this Article purchase its own shares if as a result of the purchase there would no longer be any member of the company holding shares other than redeemable shares[F166 or shares held as treasury shares].

[F166 (4) For the purposes of this Chapter “qualifying shares” are shares which—

(a) are included in the official list in accordance with the provisions of Part 6 of the Financial Services and Markets Act 2000,

(b) are traded on the market known as the Alternative Investment Market established under the rules of London Stock Exchange plc,

(c) are officially listed in an EEA State, or

(d) are traded on a market established in an EEA State which is a regulated market for the purposes of Article 16 of Council Directive 93/22/EEC on investment services in the securities field,

and in sub-paragraph (a) “the official list” has the meaning given in section 103(1) of the Financial Services and Markets Act 2000.]

F165 mod. by 1989 NI 19

F166 SR 2004/275

Treasury shares N.I.

172A.—(1) Where qualifying shares are purchased by a company out of distributable profits in accordance with Article 172, the company may—

(a) hold the shares (or any of them), or

(b) deal with any of them, at any time, in accordance with Article 172D.

(2) Where shares are held under paragraph (1)(a) then, for the purposes of Article 360, the company must be entered in the register as the member holding those shares.

(3) In this Order, references to a company holding shares as treasury shares are references to the company holding shares which—

(a) were (or are treated as having been) purchased by it in circumstances in which this Article applies, and

(b) have been held by the company continuously since they were so purchased.

Treasury shares: maximum holdings N.I.

172B.—(1) Where a company has shares of only one class, the aggregate nominal value of shares held as treasury shares must not at any time exceed 10 per cent of the nominal value of the issued share capital of the company at that time.

(2) Where the share capital of a company is divided into shares of different classes, the aggregate nominal value of the shares of any class held as treasury shares must not at any time exceed 10 per cent of the nominal value of the issued share capital of the shares in that class at that time.

(3) Where paragraph (1) or (2) is contravened by a company, the company must dispose of or cancel the excess shares, in accordance with Article 172D, before the end of the period of 12 months beginning with the day on which that contravention occurs.

For this purpose “the excess shares” means such number of the shares, held by the company as treasury shares at the time in question, as resulted in the limit being exceeded.

Treasury shares: voting and other rights N.I.

172C.—(1) This Article applies to shares which are held by a company as treasury shares ( “the treasury shares”).

(2) The company must not exercise any right in respect of the treasury shares and any purported exercise of such a right is void.

(3) The rights to which paragraph (2) applies include any right to attend or vote at meetings (including meetings under Article 418).

(4) No dividend may be paid, and no other distribution (whether in cash or otherwise) of the company's assets (including any distribution of assets to members on a winding up) may be made, to the company in respect of the treasury shares.

(5) Nothing in this Article is to be taken as preventing—

(a) an allotment of shares as fully paid bonus shares in respect of the treasury shares, or

(b) the payment of any amount payable on the redemption of the treasury shares (if they are redeemable shares).

(6) Any shares allotted as fully paid bonus shares in respect of the treasury shares shall be treated for the purposes of this Order as if they were purchased by the company at the time they were allotted, in circumstances in which Article 172A(1) applied.

Treasury shares: disposal and cancellation N.I.

172D.—(1) Where shares are held as treasury shares, a company may at any time—

(a) sell the shares (or any of them) for cash,

(b) transfer the shares (or any of them) for the purposes of or pursuant to an employees' share scheme, or

(c) cancel the shares (or any of them).

(2) For the purposes of paragraph (1)(a), “cash”, in relation to a sale of shares by a company, means—

(a) cash (including foreign currency) received by the company, or

(b) a cheque received by the company in good faith which the directors have no reason for suspecting will not be paid, or

(c) a release of a liability of the company for a liquidated sum, or

(d) an undertaking to pay cash to the company on or before a date not more than 90 days after the date on which the company agrees to sell the shares.

(3) But if the company receives a notice under [F167 section 979 of the Companies Act 2006] (right of offeror to buy out minority shareholders)[7] that a person desires to acquire any of the shares, the company must not, under paragraph (1), sell or transfer the shares to which the notice relates except to that person.

(4) If under paragraph (1) the company cancels shares held as treasury shares, the company must diminish the amount of the issued share capital by the nominal value of the shares cancelled; but the cancellation is not to be taken as reducing the amount of the company's authorised share capital.

(5) The directors may take such steps as are requisite to enable the company to cancel its shares under paragraph (1) without complying with Articles 145 and 146 (special resolution for reduction of share capital; application to court for order of confirmation).

F167 Words in art. 172D(3) substituted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts.1(3), 6(1), Sch. 3 para. 2 (with art. 11(1)

Treasury shares: mandatory cancellation N.I.

172E.—(1) If shares held as treasury shares cease to be qualifying shares, the company must forthwith cancel the shares in accordance with Article 172D.

(2) For the purposes of paragraph (1), shares are not to be regarded as ceasing to be qualifying shares by virtue only of—

(a) the suspension of their listing in accordance with the applicable rules in the EEA State in which the shares are officially listed, or

(b) the suspension of their trading in accordance with—

(i) in the case of shares traded on the market known as the Alternative Investment Market, the rules of London Stock Exchange plc, and

(ii) in any other case, the rules of the regulated market on which they are traded.

(3) For the purposes of this Article “regulated market” means a market which is a regulated market for the purposes of Article 16 of Council Directive 93/22/EEC on investment services in the securities field.

Treasury shares: proceeds of sale N.I.

172F.—(1) Where shares held as treasury shares are sold, the proceeds of sale shall be dealt with in accordance with this Article.

(2) Where the proceeds of sale are equal to or less than the purchase price paid by the company for the shares, the proceeds shall be treated for the purposes of Part IX as a realised profit of the company.

(3) Where the proceeds of sale exceed the purchase price paid by the company for the shares—

(a) that part of the proceeds of sale that is equal to the purchase price paid shall be treated for the purposes of Part IX as a realised profit of the company, and

(b) a sum equal to the excess shall be transferred to the company's share premium account.

(4) The purchase price paid by the company for the shares shall be determined by the application of a weighted average price method.

(5) Where the shares were allotted to the company as fully paid bonus shares, the purchase price paid for them shall, for the purposes of paragraph (4), be treated as being nil.

Treasury shares: penalty for contravention N.I.

172G.  If a company contravenes any provision of Articles 172A to 172F every officer of it who is in default is liable to a fine.

Definitions of “off-market” and “market” purchase N.I.

173 .F168 —(1) A purchase by a company of its own shares is “off-market” if the shares either—

(a) are purchased otherwise than on[F169 a recognised investment exchange], or

(b) are purchased on[F169 a recognised investment exchange] but are not subject to a marketing arrangement on[F169 that investment exchange].

(2) For this purpose, a company's shares are subject to a marketing arrangement on[F169 a recognised investment exchange] if either—

(a) they are listed[F169 under[F170 Part 6 of the Financial Services and Markets Act 2000]]; or

(b) the company has been afforded facilities for dealings in those shares to take place on[F169 that investment exchange] without prior permission for individual transactions from the authority governing[F169 that investment exchange] and without limit as to the time during which those facilities are to be available.

(3) A purchase by a company of its own shares is a “market” purchase if it is a purchase made on[F169 a recognised investment exchange], other than a purchase which is an off-market purchase by virtue of paragraph (1)(b).

[F170 (4) “Recognised investment exchange” means a recognised investment exchange other than an overseas investment exchange.

(5) Expressions used in the definition contained in paragraph (4) have the same meaning as in Part 18 of the Financial Services and Markets Act 2000.]

F168 mod. by 1989 NI 19

F169 1986 c. 60

F170 SI 2001/3649

Authority for off-market purchase N.I.

174 .F171 —(1) A company may only make an off-market purchase of its own shares in pursuance of a contract approved in advance in accordance with this Article or Article 175.

(2) The terms of the proposed contract must be authorised by a special resolution of the company before the contract is entered into; and the following paragraphs apply with respect to that authority and to resolutions conferring it.

(3) Subject to paragraph (4), the authority may be varied, revoked or from time to time renewed by special resolution of the company.

(4) In the case of a public company the authority conferred by the resolution must specify a date on which the authority is to expire; and in a resolution conferring or renewing authority that date must not be later than 18 months after that on which the resolution is passed.

(5) A special resolution to confer, vary, revoke or renew authority is not effective if any member of the company holding shares to which the resolution relates exercises the voting rights carried by any of those shares in voting on the resolution and the resolution would not have been passed if he had not done so.

For this purpose—

(a)

a member who holds shares to which the resolution relates is regarded as exercising the voting rights carried by those shares not only if he votes in respect of them on a poll on the question whether the resolution shall be passed, but also if he votes on the resolution otherwise than on a poll;

(b)

notwithstanding anything in the company's articles, any member of the company may demand a poll on that question; and

(c)

a vote and a demand for a poll by a person as proxy for a member are the same respectively as a vote and a demand by the member.

(6) Such a resolution is not effective for the purposes of this Article unless (if the proposed contract is in writing) a copy of the contract or (if not) a written memorandum of its terms is available for inspection by members of the company both—

(a) at the company's registered office for not less than 15 days ending with the date of the meeting at which the resolution is passed, and

(b) at the meeting itself.

A memorandum of contract terms so made available must include the names of any members holding shares to which the contract relates; and a copy of the contract so made available must have annexed to it a written memorandum specifying any such names which do not appear in the contract itself.

(7) A company may agree to a variation of an existing contract so approved, but only if the variation is authorised by a special resolution of the company before it is agreed to; and paragraphs (3) to (6) apply to the authority for a proposed variation as they apply to the authority for a proposed contract, save that a copy of the original contract or (as the case may require) a memorandum of its terms, together with any variations previously made, must also be available for inspection in accordance with paragraph (6).

F171 mod. by 1989 NI 19

Authority for contingent purchase contract N.I.

175 .F172 —(1) A contingent purchase contract is a contract entered into by a company and relating to any of its shares—

(a) which does not amount to a contract to purchase those shares, but

(b) under which the company may (subject to any conditions) become entitled or obliged to purchase those shares.

(2) A company may only make a purchase of its own shares in pursuance of a contingent purchase contract if the contract is approved in advance by a special resolution of the company before the contract is entered into; and paragraphs (3) to (7) of Article 174 apply to the contract and its terms.

F172 mod. by 1989 NI 19

Authority for market purchase N.I.

176 .F173 —(1) A company shall not make a market purchase of its own shares unless the purchase has first been authorised by the company in general meeting.

(2) That authority—

(a) may be general for that purpose, or limited to the purchase of shares of any particular class or description, and

(b) may be unconditional or subject to conditions.

(3) The authority must—

(a) specify the maximum number of shares authorised to be acquired,

(b) determine both the maximum and the minimum prices which may be paid for the shares, and

(c) specify a date on which it is to expire.

(4) The authority may be varied, revoked or from time to time renewed by the company in general meeting, but this is subject to paragraph (3); and in a resolution to confer or renew authority, the date on which the authority is to expire must not be later than 18 months after that on which the resolution is passed.

(5) A company may under this Article make a purchase of its own shares after the expiry of the time limit imposed to comply with paragraph (3)(c), if the contract of purchase was concluded before the authority expired and the terms of the authority permitted the company to make a contract of purchase which would or might be executed wholly or partly after its expiration.

(6) A resolution to confer or vary authority under this Article may determine either or both the maximum and minimum prices for purchase by—

(a) specifying a particular sum, or

(b) providing a basis or formula for calculating the amount of the price in question without reference to any person's discretion or opinion.

[F174 (7) Chapter 3 of Part 3 of the Companies Act 2006 (resolutions affecting a company's constitution) applies to a resolution of a company conferring, varying, revoking or renewing authority under this Article.]

F173 mod. by 1989 NI 19

F174 Words in art. 176(7) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(8) (with art. 12)

Assignment or release of company's right to purchase own shares N.I.

177 .F175 —(1) The rights of a company under a contract approved under Article 174 or 175, or under a contract for a purchase authorised under Article 176, are not capable of being assigned.

(2) An agreement by a company to release its rights under a contract approved under Article 174 or 175 is void unless the terms of the release agreement are approved in advance by a special resolution of the company before the agreement is entered into; and paragraphs (3) to (7) of Article 174 apply to approval for a proposed release agreement as to authority for a proposed variation of an existing contract.

F175 mod. by 1989 NI 19

Payments apart from purchase price to be made out of distributable profits N.I.

178 .F176 —(1) A payment made by a company in consideration of—

(a) acquiring any right with respect to the purchase of its own shares in pursuance of a contract approved under Article 175, or

(b) the variation of a contract approved under Article 174 or 175, or

(c) the release of any of the company's obligations with respect to the purchase of any of its own shares under a contract approved under Article 174 or 175 or under a contract for a purchase authorised under Article 176,

must be made out of the company's distributable profits.

(2) If the requirements of paragraph (1) are not satisfied in relation to a contract—

(a) in a case within paragraph (1)(a), no purchase by the company of its own shares in pursuance of that contract is lawful under this Chapter,

(b) in a case within paragraph (1)(b), no such purchase following the variation is lawful under this Chapter, and

(c) in a case within paragraph (1)(c), the purported release is void.

F176 mod. by 1989 NI 19

Disclosure by company of purchase of own shares N.I.

179 .F177 —(1) Within the period of 28 days beginning with the date on which any shares purchased by a company under this Chapter are delivered to it, the company shall deliver to the registrar for registration a return in the prescribed form stating with respect to shares of each class purchased the number and nominal value of those shares and the date on which they were delivered to the company.

[F178 (1A) But in the case of a company which has purchased its own shares in circumstances in which Article 172A applies, the requirement to deliver a return under paragraph (1) shall apply only where some or all of the shares have been cancelled forthwith after the date of their delivery in accordance with Article 172D(1) and in those circumstances the particulars required by that paragraph to be stated with respect to the shares purchased shall apply only to such of the shares as have been so cancelled.

(1B) Where a company has purchased its own shares in circumstances in which Article 172A applies, the company shall within the period of 28 days beginning with the date on which such shares are delivered to it (except where all of the shares have been cancelled forthwith after the date of their delivery in the circumstances referred to in paragraph (1A)) deliver to the registrar for registration a return in the prescribed form stating with respect to shares of each class purchased (other than any shares which have been cancelled in the circumstances referred to in paragraph (1A)) the number and nominal value of each of those shares which are held as treasury shares and the date on which they were delivered to the company.]

(2) In the case of a public company,[F178 any return under paragraph (1) or (1B)] shall also state—

(a) the aggregate amount paid by the company for the shares; and

(b) the maximum and minimum prices paid in respect of shares of each class purchased.

(3) Particulars of shares delivered to the company on different dates and under different contracts may be included in a single return[F178 under either paragraph (1) or (1B)] to the registrar; and in such a case the amount required to be stated under paragraph (2)(a) is the aggregate amount paid by the company for all the shares to which the return relates.

(4) Where a company enters into a contract approved under Article 174 or 175, or a contract for a purchase authorised under Article 176, the company shall keep at its registered office—

(a) if the contract is in writing, a copy of it; and

(b) if not, a memorandum of its terms,

from the conclusion of the contract until the end of the period of 10 years beginning with the date on which the purchase of all the shares in pursuance of the contract is completed or (as the case may be) the date on which the contract otherwise determines.

(5) Every copy and memorandum so required to be kept shallF179 . . . be open to inspection without charge—

(a) by any member of the company, and

(b) if it is a public company, by any other person.

(6) If default is made in delivering to the registrar any return required by this Article, every officer of the company who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(7) If default is made in complying with paragraph (4), or if an inspection required under paragraph (5) is refused, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(8) In the case of a refusal of an inspection required under paragraph (5) of a copy or memorandum, the court may by order compel an immediate inspection of it.

(9) The obligation of a company under paragraph (4) to keep a copy of any contract or (as the case may be) a memorandum of its terms applies to any variation of the contract so long as it applies to the contract.

F177 mod. by 1989 NI 19

F178 SR 2004/275

F179 1990 NI 10

[F180 Disclosure by company of cancellation or disposal of treasury shares N.I.

179A.— (1) Paragraph (2) applies in relation to any shares held by a company as treasury shares if—

(a) the company is or was required to make a return under Article 179(1B) in relation to the shares, and

(b) the shares have—

(i) been cancelled in accordance with Article 172D(1), or

(ii) been sold or transferred for the purposes of or pursuant to an employees' share scheme under Article 172D(1).

(2) Within the period of 28 days beginning with the date on which such shares are cancelled or disposed of, the company shall deliver to the registrar for registration a return in the prescribed form stating with respect to shares of each class cancelled or disposed of—

(a) the number and nominal value of those shares, and

(b) the date on which they were cancelled or disposed of.

(3) Particulars of shares cancelled or disposed of on different dates may be included in a single return to the registrar.

(4) If default is made in delivering to the registrar any return required by this Article, every officer of the company who is in default is liable to a fine and, for continued contravention, to a daily default fine.]

F180 SR 2004/275

The capital redemption reserve N.I.

180 .F181 —(1) Where under this Chapter shares of a company are redeemed or purchased wholly out of the company's profits, the amount by which the company's issued share capital is diminished in accordance with Article 170(4) on cancellation of the shares redeemed or purchased [F182 , or in accordance with Article 172D(4) on cancellation of shares held as treasury shares,] shall be transferred to a reserve, called “the capital redemption reserve”.

(2) If the shares are redeemed or purchased wholly or partly out of the proceeds of a fresh issue and the aggregate amount of those proceeds is less than the aggregate nominal value of the shares redeemed or purchased, the amount of the difference shall be transferred to the capital redemption reserve.

(3) But paragraph (2) does not apply if the proceeds of the fresh issue are applied by the company in making a redemption or purchase of its own shares in addition to a payment out of capital under Article 181.

(4) The provisions of this Order relating to the reduction of a company's share capital apply as if the capital redemption reserve were paid-up share capital of the company, except that the reserve may be applied by the company in paying up its unissued shares to be allotted to members of the company as fully paid bonus shares.

F181 mod. by 1989 NI 19

F182 SR 2004/275

Redemption or purchase of own shares out of capital (private companies only)F1029 N.I.

Power of private companies to redeem or purchase own shares out of capital N.I.

181 .F183 —(1) Subject to the following provisions of this Chapter, a private company limited by shares or limited by guarantee and having a share capital may, if so authorised by its articles, make a payment in respect of the redemption or purchase under Article 170 (as the case may be) Article 172, of its own shares otherwise than out of its distributable profits or the proceeds of a fresh issue of shares.

(2) References in this Chapter to payment out of capital are (subject to paragraph (6)) to any payment so made, whether or not it would be regarded apart from this Article as a payment out of capital.

(3) The payment which may (if authorised in accordance with the following provisions of this Chapter) be made by a company out of capital in respect of the redemption or purchase of its own shares is such an amount as, taken together with—

(a) any available profits of the company, and

(b) the proceeds of any fresh issue of shares made for the purposes of the redemption or purchase,

is equal to the price of redemption or purchase; and the payment permissible under this paragraph is referred to in this Chapter as the permissible capital payment for the shares.

(4) Subject to paragraph (6), if the permissible capital payment for shares redeemed or purchased is less than their nominal amount, the amount of the difference shall be transferred to the company's capital redemption reserve.

(5) Subject to paragraph (6), if the permissible capital payment is greater than the nominal amount of the shares redeemed or purchased—

(a) the amount of any capital redemption reserve, share premium account or fully paid share capital of the company, and

(b) any amount representing unrealised profits of the company for the time being standing to the credit of any reserve maintained by the company in accordance with paragraph 34 of Schedule 4[F184 or paragraph 34 of Schedule 8] (revaluation reserve),

may be reduced by a sum not exceeding (or by sums not in the aggregate exceeding) the amount by which the permissible capital payment exceeds the nominal amount of the shares.

(6) Where the proceeds of a fresh issue are applied by a company in making any redemption or purchase of its own shares in addition to a payment out of capital under this Article, the references in paragraphs (4) and (5) to the permissible capital payment are to be read as referring to the aggregate of that payment and those proceeds.

F183 mod. by 1989 NI 19

F184 SR 1997/436

Availability of profits for the purposes of Article 181 N.I.

182 .F185 —(1) The reference in Article 181(3)(a) to available profits of the company is to the company's profits which are available for distribution (within the meaning of Part IX); but the question whether a company has any profits so available and the amount of any such profits are to be determined for the purposes of that Article in accordance with the following paragraphs, instead of Articles 278 to 283.

(2) Subject to paragraph (3), that question is to be determined by reference to[F186 the following items as stated in the relevant accounts for determining the permissible capital payments for shares]

(a) profits, losses, assets and liabilities;

(b) [F186 the following provisions—]

[F186 (i)] [F186 in the case of Companies Order individual accounts,] provisions of any of the kinds mentioned in paragraphs 87 and 88 of Schedule 4 (depreciation, diminution in value of assets, retentions to meet liabilities, etc.)[F186 , and]

[F186 (ii)] [F186 in the case of IAS individual accounts, provisions of any kind]; and

(c) share capital and reserves (including undistributable reserves),

F186 . . .

(3) The relevant accounts for this purpose are such accounts, prepared as at any date within the period for determining the amount of the permissible capital payment, as are necessary to enable a reasonable judgement to be made as to the amounts of any of the items mentioned in paragraph (2)(a) to (c).

(4) For the purposes of determining the amount of the permissible capital payment for shares, the amount of the company's available profits (if any) determined in accordance with paragraphs (2) and (3) is treated as reduced by the amount of any distributions lawfully made by the company after the date of the relevant accounts and before the end of the period for determining the amount of that payment.

(5) The reference in paragraph (4) to distributions lawfully made by the company includes—

(a) financial assistance lawfully given out of distributable profits in a case falling within Article 164 or 165,

(b) any payment lawfully made by the company in respect of the purchase by it of any shares in the company (except a payment lawfully made otherwise than out of distributable profits), and

(c) a payment of any description specified in Article 178(1) lawfully made by the company.

(6) References in this Article to the period for determining the amount of the permissible capital payment for shares are to the period of 3 months ending with the date on which the statutory declaration of the directors purporting to specify the amount of that payment is made in accordance with Article 183(3).

F185 mod. by 1989 NI 19

F186 SR 2004/496

Conditions for payment out of capital N.I.

183 .F187 —(1) Subject to any order of the court under Article 187, a payment out of capital by a private company for the redemption or purchase of its own shares is not lawful unless the requirements of this Article and Articles 184 and 185 are satisfied.

(2) The payment out of capital must be approved by a special resolution of the company.

(3) The company's directors must make a statutory declaration specifying the amount of the permissible capital payment for the shares in question and stating that, having made full inquiry into the affairs and prospects of the company, they have formed the opinion—

(a) as regards its initial situation immediately following the date on which the payment out of capital is proposed to be made, that there will be no grounds on which the company could then be found unable to pay its debts, and

(b) as regards its prospects for the year immediately following that date, that, having regard to their intentions with respect to the management of the company's business during that year and to the amount and character of the financial resources which will in their view be available to the company during that year, the company will be able to continue to carry on business as a going concern (and will accordingly be able to pay its debts as they fall due) throughout that year.

(4) In forming their opinion for the purposes of paragraph (3)(a), the directors shall take into account the same liabilities (including prospective and contingent liabilities) as would be relevant under[F188 Article 102 of the Insolvency Order] (winding up by the court) to the question whether a company is unable to pay its debts.

(5) The directors' statutory declaration must be in the prescribed form and contain such information with respect to the nature of the company's business as may be prescribed, and must in addition have annexed to it a report addressed to the directors by the company's auditors stating that—

(a) they have inquired into the company's state of affairs; and

(b) the amount specified in the declaration as the permissible capital payment for the shares in question is in their view properly determined in accordance with Articles 181 and 182; and

(c) they are not aware of anything to indicate that the opinion expressed by the directors in the declaration as to any of the matters mentioned in paragraph (3) is unreasonable in all the circumstances.

(6) A director who makes a declaration under this Article without having reasonable grounds for the opinion expressed in the declaration is liable to imprisonment or a fine, or both.

F187 mod. by 1989 NI 19

F188 1989 NI 19

Procedure for special resolution under Article 183 N.I.

184 .F189 —(1) The resolution required by Article 183 must be passed on, or within the week immediately following, the date on which the directors make the statutory declaration required by that Article; and the payment out of capital must be made no earlier than 5 nor more than 7 weeks after the date of the resolution.

(2) The resolution is ineffective if any member of the company holding shares to which the resolution relates exercises the voting rights carried by any of those shares in voting on the resolution and the resolution would not have been passed if he had not done so.

(3) For the purposes of paragraph (2), a member who holds such shares is to be regarded as exercising the voting rights carried by them in voting on the resolution not only if he votes in respect of them on a poll on the question whether the resolution shall be passed, but also if he votes on the resolution otherwise than on a poll; and, notwithstanding anything in a company's articles, any member of the company may demand a poll on that question.

(4) The resolution is ineffective unless the statutory declaration and auditors' report required by Article 183 are available for inspection by members of the company at the meeting at which the resolution is passed.

(5) For the purposes of this Article a vote and a demand for a poll by a person as proxy for a member are the same (respectively) as a vote and demand by the member.

F189 mod. by 1989 NI 19

Publicity for proposed payment out of capital N.I.

185 .F190 —(1) Within the week immediately following the date of the resolution for payment out of capital the company must cause to be published in the Belfast Gazette a notice—

(a) stating that the company has approved a payment out of capital for the purpose of acquiring its own shares by redemption or purchase or both (as the case may be);

(b) specifying the amount of the permissible capital payment for the shares in question and the date of the resolution under Article 183;

(c) stating that the statutory declaration of the directors and the auditors' report required by that Article are available for inspection at the company's registered office; and

(d) stating that any creditor of the company may at any time within the 5 weeks immediately following the date of the resolution for payment out of capital apply to the court under Article 186 for an order prohibiting the payment.

(2) Within the week immediately following the date of the resolution the company must also either cause a notice to the same effect as that required by paragraph (1) to be published in a newspaper circulating throughout Northern Ireland or give notice in writing to that effect to each of its creditors.

(3) References in this Article to the first notice date are to the day on which the company first publishes the notice required by paragraph (1) or first publishes or gives the notice required by paragraph (2) (whichever is the earlier).

(4) Not later than the first notice date the company must deliver to the registrar a copy of the statutory declaration of the directors and of the auditors' report required by Article 183.

(5) The statutory declaration and auditors' report—

(a) shall be kept at the company's registered office throughout the period beginning with the first notice date and ending 5 weeks after the date of the resolution for payment out of capital, and

(b) shallF191 . . . be open to the inspection of any member or creditor of the company without charge.

(6) If an inspection required under paragraph (5) is refused, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(7) In the case of refusal of an inspection required under paragraph (5) of a declaration or report, the court may by order compel an immediate inspection of that declaration or report.

F190 mod. by 1989 NI 19

F191 1990 NI 10

Objections by company's members or creditors N.I.

186 .F192 —(1) Where a private company passes a special resolution approving for the purposes of this Chapter any payment out of capital for the redemption or purchase of any of its shares—

(a) any member of the company other than one who consented to or voted in favour of the resolution; and

(b) any creditor of the company,

may within 5 weeks of the date on which the resolution was passed apply to the court for cancellation of the resolution.

(2) The application may be made on behalf of the persons entitled to make it by such one or more of their number as they may appoint in writing for the purpose.

(3) If an application is made, the company shall—

(a) forthwith give notice in the prescribed form of that fact to the registrar; and

(b) within 15 days from the making of any order of the court on the hearing of the application, or such longer period as the court may by order direct, deliver an office copy of the order to the registrar.

(4) A company which fails to comply with paragraph (3) and any officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F192 mod. by 1989 NI 19

Powers of court on application under Article 186 N.I.

187 .F193 —(1) On the hearing of an application under Article 186 the court may, if it thinks fit, adjourn the proceedings in order that an arrangement may be made to the court's satisfaction for the purchase of the interests of dissentient members or for the protection of dissentient creditors (as the case may be); and the court may give such directions and make such orders as it thinks expedient for facilitating or carrying into effect any such arrangement.

(2) Without prejudice to its powers under paragraph (1), the court shall make an order on such terms and conditions as it thinks fit either confirming or cancelling the resolution; and, if the court confirms the resolution, it may in particular by order alter or extend any date or period of time specified in the resolution or in any provision in this Chapter which applies to the redemption or purchase of shares to which the resolution refers.

(3) The court's order may, if the court thinks fit, provide for the purchase by the company of the shares of any of its members and for the reduction accordingly of the company's capital, and may make such alterations in the company's memorandum and articles as may be required in consequence of that provision.

(4) If the court's order requires the company not to make any, or any specified, alteration in its memorandum or articles, the company has not then power without leave of the court to make any such alteration in breach of the requirement.

(5) An alteration in the memorandum or articles made by virtue of an order under this Article, if not made by resolution of the company, is of the same effect as if duly made by resolution; and this Order applies accordingly to the memorandum or articles as so altered.

F193 mod. by 1989 NI 19

SupplementaryF1029 N.I.

Effect of company's failure to redeem or purchase N.I.

188 .F194 —(1) This Article has effect where a company has, on or after 1st July 1983—

(a) issued shares on terms that they are or are liable to be redeemed, or

(b) agreed to purchase any of its own shares.

(2) The company is not liable in damages in respect of any failure on its part to redeem or purchase any of the shares.

(3) Paragraph (2) is without prejudice to any right of the holder of the shares other than his right to sue the company for damages in respect of its failure; but the court shall not grant an order for specific performance of the terms of redemption or purchase if the company shows that it is unable to meet the costs of redeeming or purchasing the shares in question out of distributable profits.

(4) If the company is would up and at the commencement of the winding up any of the shares have not been redeemed or purchased, the terms of redemption or purchase may be enforced against the company; and when shares are redeemed or purchased under this paragraph they are treated as cancelled.

(5) However, paragraph (4) does not apply if—

(a) the terms provided for the redemption or purchase to take place at a date later than that of the commencement of the winding up, or

(b) during the period beginning with the date on which the redemption or purchase was to have taken place and ending with the commencement of the winding up the company could not at any time have lawfully made a distribution equal to value to the price at which the shares were to have been redeemed or purchased.

(6) There shall be paid in priority to any amount which the company is liable under paragraph (4) to pay in respect of any shares—

(a) all other debts and liabilities of the company (other than any due to members in their character as such),

(b) if other shares carry rights (whether as to capital or as to income) which are preferred to the rights as to capital attaching to the first-mentioned shares, any amount due in satisfaction of those preferred rights;

but, subject to that, any such amount shall be paid in priority to any amounts due to members in satisfaction of their rights (whether as to capital or income) as members.

Para. (7) rep. by 1989 NI 19

F194 mod. by 1989 NI 19

Power of Department to modify this Chapter N.I.

189 .F195 —(1) The Department may by regulations modify the provisions of this Chapter with respect to any of the following matters—

(a) the authority required for a purchase by a company of its own shares,

(b) the authority required for the release by a company of its rights under a contract for the purchase of its own shares or a contract under which the company may (subject to any conditions) become entitled or obliged to purchase its own shares,

(c) the information to be included in a return delivered by a company to the registrar in accordance with Article 179(1),

(d) the matters to be dealt with in the statutory declaration of the directors under Article 183 with a view to indicating their opinion of their company's ability to make a proposed payment out of capital with due regard to its financial situation and prospects, and

(e) the contents of the auditors' report required by that Article to be annexed to that declaration.

(2) The Department may also by regulations make such provision (including modification of the provisions of this Chapter) as appears to it to be appropriate—

(a) for wholly or partly relieving companies from the requirement of Article 181(3)(a) that any available profits must be taken into account in determining the amount of the permissible capital payment for shares under that Article, or

(b) for permitting a company's share premium account to be applied, to any extent appearing to the Department to be appropriate, in providing for the premiums payable on the redemption or purchase by the company of any of its own shares.

(3) Regulations under this Article may make such further modification of any provisions of this Chapter as appears to the Department to be reasonably necessary in consequence of any provision made under such regulations by virtue of paragraph (1) or (2).

(4) No regulations shall be made under this Article unless a draft of the regulations has been laid before, and approved by a resolution of, the Assembly.

F195 mod. by 1989 NI 19

Transitional cases arising under this Chapter; and savings N.I.

190 .F196 —(1) Any preference shares issued by a company before 1st July 1983 which could but for the repeal by the Order of 1982 of section 58 of the Act of 1960 (power to issue redeemable preference shares) have been redeemed under that section are subject to redemption in accordance with the provisions of this Chapter.

(2) In a case to which Articles 169 and 170 apply by virtue of this Article, any premium payable on redemption may, notwithstanding the repeal by the Order of 1982 of any provision of the Act of 1960, be paid out of the share premium account instead of out of profits, or partly out of that account and partly out of profits (but subject to the provisions of this Chapter so far as payment is out of profits).

(3) Any capital redemption reserve fund established before 1st July 1983 by a company for the purposes of section 58 of the Act of 1960 is to be known as the company's capital redemption reserve and to be treated as if it had been established for the purposes of Article 180; and accordingly, a reference in any statutory provision or in the articles of any company, or in any other instrument, to a company's capital redemption reserve fund is to be construed as a reference to the company's capital redemption reserve.

F196 mod. by 1989 NI 19

Interpretation for Chapter VII N.I.

191 .F197   In this Chapter—

(a) “distributable profits”, in relation to the making of any payment by a company, means those profits out of which it could lawfully make a distribution (within the meaning given by Article 271(2)), equal in value to the payment, and

(b) “permissible capital payment” means the payment permitted by Article 181;

and references to payment out of capital are to be construed in accordance with Article 181.

F197 mod. by 1989 NI 19

CHAPTER VIIIF1029 N.I. MISCELLANEOUS PROVISIONS ABOUT SHARES AND DEBENTURES

Share and debenture certificates, transfers and warrantsF1029 N.I.

Nature, transfer and numbering of shares N.I.

192.—(1) The shares or other interest of any member in a company—

(a) are personal estate and are not in the nature of real estate,

(b) are transferable in manner provided by the company's articles, but subject to the [1963 c. 24 (N.I.)] Stock Transfer Act (Northern Ireland) 1963 (which enables securities of certain descriptions to be transferred by a simplified process) [F198 and to regulations made under section 207 of the Companies Act 1989 (which enable title to securities to be evidenced and transferred without a written instrument).]

(2) Each share in a company having a share capital shall be distinguished by its appropriate number; except that, if at any time all the issued shares in a company, or all the issued shares in it of a particular class, are fully paid up and rank pari passu for all purposes, none of those shares need thereafter have a distinguishing number so long as it remains fully paid up and ranks pari passu for all purposes with all shares of the same class for the time being issued and fully paid up.

F198 SI 1995/3272

Transfer and registration N.I.

193.—(1 )F199  It is not lawful for a company to register a transfer of shares in or debentures of the company unless a proper instrument of transfer has been delivered to it, or the transfer is an exempt transfer with the [1982 c. 41] Stock Transfer Act 1982 [F200 or is in accordance with regulations made under section 207 of the Companies Act 1989].

This applies notwithstanding anything in the company's articles.

(2 )F199  Paragraph (1) does not prejudice any power of the company to register as shareholder or debenture holder a person to whom the right to any shares in or debentures of the company has been transmitted by operation of law.

(3 )F199  A transfer of the share or other interest of a deceased member of a company made by his personal representative, although the personal representative is not himself a member of the company, is as valid as if he had been such a member at the time of the execution of the instrument of transfer.

(4 )F199  On the application of the transferor of any share or interest in a company, the company shall enter in its register of members the name of the transferee in the same manner and subject to the same conditions as if the application for the entry were made by the transferee.

(5 )F199  If a company refuses to register a transfer of shares or debentures, the company shall, within 2 months after the date on which the transfer was lodged with it, send to the transferee notice of the refusal.

(6) If default is made in complying with paragraph (5), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F199 mod. by SR 2004/307

F200 SI 1995/3272

Certification of transfers N.I.

194.—(1 )F201  The certification by a company of any instrument of transfer of any shares in, or debentures of, the company is to be taken as a representation by the company to any person acting on the faith of the certification that there have been produced to the company such documents as on their face show a prima facie title to the shares or debentures in the transferor named in the instrument.

However, the certification is not to be taken as a representation that the transferor has any title to the shares or debentures.

(2) Where a person acts on the faith of a false certification by a company made negligently, the company is under the same liability to him as if the certification had been made fraudulently.

(3) For the purposes of this Article—

(a) an instrument of transfer is deemed certificated if it bears the words “certificate lodged” (or words to the like effect);

(b) the certification of an instrument of transfer is deemed made by a company if—

(i) the person issuing the instrument is a person authorised to issue certificated instruments of transfer on the company's behalf, and

(ii) the certification is signed by a person authorised to certificate transfers on the company's behalf or by an officer or servant either of the company or of a body corporate so authorised;

(c) a certification is deemed signed by a person if—

(i) it purports to be authenticated by his signature or initials (whether handwritten or not), and

(ii) it is not shown that the signature or initials was or were placed there neither by himself nor by a person authorised to use the signature or initials for the purpose of certificating transfers on the company's behalf.

F201 mod. by SR 2004/307

Duty of company as to issue of certificates N.I.

195.—(1 )F202  Subject to the following provisions, every company shall—

(a) within 2 months after the allotment of any of its shares, debentures or debenture stock, and

(b) within 2 months after the date on which a transfer of any such shares, debentures or debenture stock is lodged with the company,

complete and have ready for delivery the certificates of all shares, the debentures and the certificates of all debenture stock allotted or transferred (unless the conditions of issue of the shares, debentures or debenture stock otherwise provide).

(2) For this purpose, “transfer” means a transfer duly stamped and otherwise valid, or an exempt transfer within the [1982 c. 41] Stock Transfer Act 1982, and does not include such a transfer as the company is for any reason entitled to refuse to register and does not register.

(3 )F202  Paragraph (1) does not apply in the case of a transfer to any person where, by virtue of regulations under section 3 of the Stock Transfer Act 1982, he is not entitled to a certificate or other document of or evidencing title in respect of the securities transferred; but if in such a case the transferee—

(a) subsequently becomes entitled to such a certificate or other document by virtue of any provision of those regulation, and

(b) gives notice in writing of that fact to the company,

this Article has effect as if the reference in paragraph (1)(b) to the date of the lodging of the transfer were a reference to the date of the notice.

[F203 (4 )F202  Paragraph (4A) applies in relation to a company—

(a) of which shares or debentures are allotted to a financial institution,

(b) of which debenture stock is allotted to a financial institution, or

(c) with which a transfer for transferring shares, debentures or debenture stock to a financial institution is lodged.

(4A) The company is not required, in consequence of that allotment or transfer, to comply with paragraph (1).

(4B) “Financial institution” means—

(a) a recognised clearing house acting in relation to a recognised investment exchange; or

(b) a nominee of—

(i) a recognised clearing house acting in that way; or

(ii) a recognised investment exchange.

(4C) No person may be a nominee for the purposes of this Article unless he is a person designated for those purposes in the rules of the recognised investment exchange in question.

(4D) Expressions used in paragraphs (4B) and (4C) have the same meaning as in Part 18 of the Financial Services and Markets Act 2000.]

(5) If default is made in complying with paragraph (1), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(6) If a company on which a notice has been served requiring it to make good any default in complying with paragraph (1) fails to make good the default within 10 days after service of the notice, the court may, on the application of the person entitled to have the certificates or the debentures delivered to him, exercise the power of paragraph (7).

(7) The court may make an order directing the company and any officer of it to make good the default within such time as may be specified in the order; and the order may provide that all costs of and incidental to the application shall be borne by the company or by an officer of it responsible for the default.

F202 mod. by SR 2004/307

F203 SI 2001/3649

Certificate to be evidence of title N.I.

196 .F204   A certificate, under the common seal of the companyF205 . . . , specifying any shares held by a member, is prima facie evidence of his title to the shares.

F204 mod. by SR 1986/305

F205 1990 NI 10

Evidence of grant of representation or confirmation as executor N.I.

197.  The production to a company of any document which is by law sufficient evidence of probate of the will, or letters of administration of the estate, or confirmation as executor, of a deceased person having been granted to some person shall be accepted by the company as sufficient evidence of the grant.

This has effect notwithstanding anything in the company's articles.

[F206 Issue and effect of share warrant to bearer N.I.

198.— (1) A company limited by shares may, if so authorised by its articles, issue with respect to any fully paid shares a warrant (a “share warrant”) stating that the bearer of the warrant is entitled to the shares specified in it.

(2) A share warrant issued under the company's common seal entitles the bearer to the shares specified in it; and the shares may be transferred by delivery of the warrant.

(3) A company which issues a share warrant may, if so authorised by its articles, provide (by coupons or otherwise) for the payment of the future dividends on the shares included in the warrant.]

F206 Art. 198 substituted by 1990 NI 10, art. 65(6)

DebenturesF1029 N.I.

Register of debenture holders N.I.

199 .F207 —(1) Neither a register of holders of debentures of a company nor a duplicate of any such register or part of any such register which is kept outside Northern Ireland shall, if kept in Northern Ireland, be kept elsewhere than—

(a) at the company's registered office; or

(b) at any office of the company at which the work of making it up is done; or

(c) if the company arranges with some other person for the making up of the register or duplicate to be undertaken on its behalf by that other person, at the office of that other person at which the work is done.

(2) Where a company keeps in Northern Ireland both such a register and such a duplicate, it shall keep them at the same place.

(3) Every company which keeps any such register or duplicate in Northern Ireland shall send to the registrar notice (in the prescribed form) of the place where the register or duplicate is kept and of any change in that place.

(4) But a company is not bound to send notice under paragraph (3) where the register or duplicate has, at all times since it came into existence, been kept at the company's registered office.

(5) Where a company makes default in complying with paragraph (1) or (2) or makes default for 14 days in complying with paragraph (3), the company and every officer of the company who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(6) Where the register of holders of debentures of the company is kept at the office of some person other than the company and by reason of any default of his the company makes default in complying with paragraph (1), (2) or (3), that other person is liable to the same penalty as if he were an officer of the company who was in default.

F207 mod. by SR 2004/307

Right to inspect register N.I.

200.—(1) Every register of holders of debentures of a company shall, except when duly closedF208 . . . , be open to the inspection—

(a )F209 of the registered holder of any such debentures or any holder of shares in the company without fee; and

(b) of any other person on payment of[F208 such fee as may be prescribed].

(2 )F209  Any such registered holder of debentures or holder of shares, or any other person, may require a copy of the register of the holders of debentures of the company or any part of it, on payment of[F208 such fee as may be prescribed.]

(3) A copy of any trust deed for securing an issue of debentures shall be forwarded to every holder of any such debentures at his request on payment[F208 of such fee as may be prescribed.]

Sub-paras. (a), (b) rep. by 1990 NI 10

(4) If inspection is refused, or a copy is refused or not forwarded, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(5) Where a company is in default as mentioned in paragraph (4), the court may by order compel an immediate inspection of the register or direct that the copies required be sent to the person requiring them.

(6 )F209  For the purposes of this Article, a register is deemed to be duly closed if closed in accordance with provisions contained in the company's articles or in the debentures or, in the case of debenture stock, in the stock certificates, or in the trust deed or other document securing the debentures or debenture stock, during such period or periods, not exceeding in the whole 30 days in any year, as may be therein specified.

(7) Liability incurred by a company from the making or deletion of an entry in its register of debenture holders, or from a failure to make or delete any such entry, is not enforceable more than 20 years after the date on which the entry was made or deleted or, in the case of any such failure, the failure first occurred.

This is without prejudice to any lesser period of limitation.

F208 1990 NI 10

F209 mod. by SR 2004/307

Liability of trustees of debentures N.I.

201 .F210 —(1) Subject to this Article, any provision contained—

(a) in a trust deed for securing an issue of debentures, or

(b) in any contract with the holders of debentures secured by a trust deed,

is void in so far as it would have the effect of exempting a trustee of the deed from, or indemnifying him against, liability for breach of trust where he fails to show the degree of care and diligence required of him as trustee, having regard to the provisions of the trust deed conferring on him any powers, authorities or discretions.

(2) Paragraph (1) does not invalidate—

(a) a release otherwise validly given in respect of anything done or omitted to be done by a trustee before the giving of the release; or

(b) any provision enabling such a release to be given—

(i) on the agreement thereto of a majority of not less than three-fourths in value of the debenture holders present and voting in person or, where proxies are permitted, by proxy at a meeting summoned for the purpose, and

(ii) either with respect to specific acts or omissions or on the trustee dying or ceasing to act.

(3) Paragraph (1) does not operate—

(a) to invalidate any provision in force on 1st April 1961 so long as any person then entitled to the benefit of that provision or afterwards given the benefit of that provision under paragraph (4) remains a trustee of the deed in question, or

(b) to deprive any person of any exemption or right to be indemnified in respect of anything done or omitted to be done by him while any such provision was in force.

(4) While any trustee of a trust deed remains entitled to the benefit of a provision saved by paragraph (3), the benefit of that provision may be given either—

(a) to all trustees of the deed, present and future; or

(b) to any named trustees or proposed trustees of it,

by a resolution passed by a majority of not less than three-fourths in value of the debenture holders present in person or, where proxies are permitted, by proxy at a meeting summoned for the purpose in accordance with the provisions of the deed or, if the deed makes no provision for summoning meetings, a meeting summoned for the purpose in any manner approved by the court.

F210 mod. by SR 2004/307

Perpetual debentures N.I.

202 .F211   A condition contained in debentures, or in a deed for securing debentures, is not invalid by reason only that the debentures are thereby made irredeemable or redeemable only on the happening of a contingency (however remote), or on the expiration of a period (however long), any rule of equity to the contrary notwithstanding.

This applies to debentures whenever issued, and to deeds whenever executed.

F211 mod. by SR 2004/307

Power to re-issue redeemed debentures N.I.

203.—(1) Where (at any time) a company has redeemed debentures previously issued, then—

(a )F212 unless provision to the contrary, whether express or implied, is contained in its articles or in any contract entered into by the company; or

(b )F212 unless the company has, by passing a resolution to that effect or by some other act, manifested its intention that the debentures shall be cancelled,

the company has, and is deemed always to have had, power to re-issue the debentures, either by re-issuing the same debentures or by issuing other debentures in their place.

(2) On a re-issue of redeemed debentures, the person entitled to the debentures has, and is deemed always to have had, the same priorities as if the debentures had never been redeemed.

(3) Where a company has (at any time) deposited any of its debentures to secure advances from time to time on current account or otherwise, the debentures are not deemed to have been redeemed by reason only of the company's account having ceased to be in debit while the debentures remained so deposited.

(4) The re-issue of a debenture or the issue of another debenture in its place under the power which by this Article is given to or deemed to be possessed by a company is to be treated as the issue of a new debenture for the purposes of stamp duty; but it is not to be so treated for the purposes of any provision limiting the amount or number of debentures to be issued.

This applies whenever the issue or re-issue was made.

(5) A person lending money on the security of a debenture re-issued under this Article which appears to be duly stamped may give the debenture in evidence in any proceedings for enforcing his security without payment of the stamp duty or any penalty in respect of it, unless he had notice (or, but for his negligence, might have discovered) that the debenture was not duly stamped; but in that case the company is liable to pay the proper stamp duty and penalty.

F212 mod. by SR 2004/307

Contract to subscribe for debentures N.I.

204 .F213   A contract with a company to take up and pay for debentures of the company may be enforced by an order for specific performance.

F213 mod. by SR 2004/307

Payment of debts out of assets subject to floating charge N.I.

[F214 205.]— [F214 F215 F214 (1) This Article applies where debentures of the company are secured by a charge which, as created, was a floating charge.

(2) If possession is taken, by or on behalf of the holders of any of the debentures, of any property comprised in or subject to the charge, and the company is not at that time in course of being wound up, the company's preferential debts shall be paid out of assets coming to the hands of the person taking possession in priority to any claims for principal or interest in respect of the debentures.

(3) “Preferential debts” means the categories of debts listed in Schedule 4 to the Insolvency Order; and for the purposes of that Schedule “the relevant date” is the date of possession being taken as mentioned in paragraph (2).

(4) Payments made under this Article shall be recouped, as far as may be, out of the assets of the company available for payment of general creditors.]

F214 1989 NI 19

F215 mod. by SR 2004/307

PART VIIF1029 N.I. DISCLOSURE OF INTERESTS IN SHARES

Individual and group acquisitionsF1029 N.I.

Obligation of disclosure; the cases in which it may arise and “the relevant time” N.I.

206.  F216 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F216 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Interests to be disclosed N.I.

207.  F217 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F217 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

“Percentage level” in relation to notifiable interests N.I.

208.  F218 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F218 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Art. 209 rep. by 1990 NI 10

Particulars to be contained in notification N.I.

210.  F219 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F219 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Notification of family and corporate interests N.I.

211.  F220 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F220 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Agreement to acquire interests in a particular company N.I.

212.  F221 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F221 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Obligation of disclosure arising under Article 212 N.I.

213.  F222 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F222 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Obligation of persons acting together to keep each other informed N.I.

214.  F223 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F223 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Interests in shares by attribution N.I.

215.  F224 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F224 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Interests in shares which are to be notified N.I.

216.  F225 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F225 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Interests to be disregarded N.I.

217.  F226 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F226 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Other provisions about notification under this Part N.I.

218.  F227 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F227 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Power to make further provision by regulations N.I.

218A.  F228 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F228 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Registration and investigation of share acquisitions and disposalsF1029 N.I.

Register of interests in shares N.I.

219.  F229 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F229 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Company investigations N.I.

220.  F230 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F230 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Registration of interests disclosed under Article 220 N.I.

221.  F231 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F231 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Company investigation on requisition by members N.I.

222.  F232 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F232 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Company report to members N.I.

223.  F233 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F233 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Penalty for failure to provide information N.I.

224.  F234 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F234 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Removal of entries from register N.I.

225.  F235 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F235 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Otherwise, entries not to be removed N.I.

226.  F236 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F236 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Inspection of register and reports N.I.

227.  F237 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F237 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

SupplementaryF1029 N.I.

Interpretation of Part VII N.I.

228.  F238 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F238 Arts. 206-228 repealed (20.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

F239 F240 F241 F242 Part VIIIF1029 N.I. Accounts and Audit

F239 mod. SR 1994/133

F240 Pt. VIII substituted by S.I. 1990/593 (N.I. 5), Pt. II

F241 Pt. VIII modified by S.R. 2004/307 (as amended (1.10.2006) by Limited Liability Partnerships (Amendment) Regulations (Northern Ireland) 2006 (S.R. 2006/377), reg. 2, Sch. 1)

F242 Pt. VIII modified by {S.R. 2004/496}

Chapter 1F1029 N.I. Provisions Applying to Companies Generally

Accounting recordsF1029 N.I.

Duty to keep accounting records N.I.

229 .F243 —(1) Every company shall keep accounting records which are sufficient to show and explain the company's transactions and are such as to—

(a) disclose with reasonable accuracy, at any time, the financial position of the company at that time, and

(b) enable the directors to ensure that[F244 any accounts required to be prepared under this Part comply] with the requirements of this Order[F244 (and, where applicable, of Article 4 of the IAS Regulation)].

(2) The accounting records shall in particular contain—

(a) entries from day to day of all sums of money received and expended by the company, and the matters in respect of which the receipt and expenditure takes place, and

(b) a record of the assets and liabilities of the company.

(3) If the company's business involves dealing in goods, the accounting records shall contain—

(a) statements of stock held by the company at the end of each financial year of the company,

(b) all statements of stocktakings from which any such statement of stock as is mentioned in sub‐paragraph (a) has been or is to be prepared, and

(c) except in the case of goods sold by way of ordinary retail trade, statements of all goods sold and purchased, showing the goods and the buyers and sellers in sufficient detail to enable all these to be identified.

(4) A parent company which has a subsidiary undertaking in relation to which the above requirements do not apply shall take reasonable steps to secure that the undertaking keeps such accounting records as to enable the directors of the parent company to ensure that[F244 any accounts required to be prepared under this Part comply] with the requirements of this Order[F244 (and, where applicable, of Article 4 of the IAS Regulation)].

(5) If a company fails to comply with any provision of this Article, every officer of the company who is in default is guilty of an offence unless he shows that he acted honestly and that in the circumstances in which the company's business was carried on the default was excusable.

(6) A person guilty of an offence under this Article is liable to imprisonment or a fine, or both.

F243 mod. SR 1994/133

F244 SR 2004/496

Where and for how long records to be kept N.I.

230 .F245 —(1) A company's accounting records shall be kept at its registered office or such other place as the directors think fit, and shall at all times be open to inspection by the company's officers.

(2) If accounting records are kept at a place outside Northern Ireland, accounts and returns with respect to the business dealt with in the accounting records so kept shall be sent to, and kept at, a place in Northern Ireland, and shall at all times be open to such inspection.

(3) The accounts and returns to be sent to Northern Ireland shall be such as to—

(a) disclose with reasonable accuracy the financial position of the business in question at intervals of not more than 6 months; and

(b) enable the directors to ensure that[F246 the accounts required to be prepared under this Part] comply with the requirements of this Order[F246 (and, where applicable, Article 4 of the IAS Regulation)].

(4) If a company fails to comply with any provision of paragraphs (1) to (3), every officer of the company who is in default is guilty of an offence, and liable to imprisonment or a fine or both, unless he shows that he acted honestly and that in the cirsumstances in which the company's business was carried on the default was excusable.

(5) Accounting records which a company is required by Article 229 to keep shall be preserved by it—

(a) in the case of a private company, for 3 years from the date on which they are made, and

(b) in the case of a public company, for 6 years from the date on which they are made.

This is subject to any provision contained in rules made under Article 359 of the Insolvency (Northern Ireland) Order 1989 (insolvency rules).

(6) An officer of a company is guilty of an offence, and liable to imprisonment or a fine or both, if he fails to take all reasonable steps for securing compliance by the company with paragraph (5) or intentionally causes any default by the company under that paragraph.

(7) Until the coming into operation of Article 359 of the Insolvency (Northern Ireland) Order 1989, paragraph (5) shall have effect with the substitution of “ Article 613 (winding‐up rules) ” for “Article 359 of the Insolvency (Northern Ireland) Order 1989 (insolvency rules).”

F245 mod. SR 1994/133

F246 SR 2004/496

A company's financial and accounting reference periodsF1029 N.I.

A company's financial year N.I.

231 .F247 —(1) A company's “financial year” is determined as follows.

(2) Its first financial year begins with the first day of its first accounting reference period and ends with the last day of that period or such other date, not more than 7 days before or after the end of that period, as the directors may determine.

(3) Subsequent financial years begin with the day immediately following the end of the company's previous financial year and end with the last day of its next accounting reference period or such other date, not more than 7 days before or after the end of that period, as the directors may determine.

(4) In relation to an undertaking which is not a company, references in this Order to its financial year are to any period in respect of which a profit and loss account of the undertaking is required to be made up (by its constitution or by the law under which it is established), whether that period is a year or not.

(5) The directors of a parent company shall secure that, except where in their opinion there are good reasons against it, the financial year of each of its subsidiary undertakings coincides with the company's own financial year.

F247 mod. SR 1994/133

Accounting reference periods and accounting reference date N.I.

232 .F248 —(1) A company's accounting reference periods are determined according to its accounting reference date.

(2) A company[F249 incorporated before 22nd August 1997] may, at any time before the end of the period of 9 months beginning with the date of its incorporation, by notice in the prescribed form given to the registrar specify its accounting reference date, that is, the date on which its accounting reference period ends in each calendar year.

(3) Failing such notice,[F249 the accounting reference date of such a company] is—

(a) in the case of a company incorporated before the coming into operation of Article 5 of the Companies (Northern Ireland) Order 1990, 31st March;

(b) in the case of a company incorporated after the coming into operation of that Article, the last day of the month in which the anniversary of its incorporation falls.

[F249 (3A) The accounting reference date of a company incorporated on or after 22nd August 1997 is the last day of the month in which the anniversary of its incorporation falls.]

(4) A company's first accounting reference period is the period of more than 6 months, but not more than 18 months, beginning with the date of its incorporation and ending with its accounting reference date.

(5) Its subsequent accounting reference periods are successive periods of 12 months beginning immediately after the end of the previous accounting reference period and ending with its accounting reference date.

(6) This Article has effect subject to the provisions of Article 233 relating to the alteration of accounting reference dates and the consequences of such alteration.

F248 mod. SR 1994/133

F249 SR 1997/314

Alteration of accounting reference date N.I.

233.—F250 (1) A company may by notice in the prescribed form given to the registrar specify a new accounting reference date[F251 having effect in relation to—

(a) the company's current accounting reference period and subsequent periods; or

(b) the company's previous accounting reference period and subsequent periods.

A company's "previous accounting reference period" means that immediately preceding its current accounting reference period.]

Para. (2) rep. by SR 1997/314

[F252 (3) The notice shall state whether the current or previous accounting reference period—

(a) is to be shortened, so as to come to an end on the first occasion on which the new accounting reference date falls or fell after the beginning of the period, or

(b) is to be extended, so as to come to an end on the second occasion on which that date falls or fell after the beginning of the period.

(4) A notice under paragraph (1) stating that the current[F251 or previous] accounting reference period is to be extended is ineffective, except as mentioned below, if given less than 5 years after the end of an earlier accounting reference period of the company which was extended by virtue of this Article.

This paragraph does not apply—

(a)

[F251 to a notice given by a company which is a subsidiary undertaking or parent undertaking of another EEA undertaking if the new accounting reference date coincides with that of the other EEA undertaking or, where that undertaking is not a company, with the last day of its financial year, or]

(b)

where[F253 the company is in administration] under Part III of the Insolvency (Northern Ireland) Order 1989,

or where the Department directs that it should not apply, which it may do with respect to a notice which has been given or which may be given.

(5) A notice under[F251 paragraph (1)] may not be given[F251 in respect of a previous accounting reference period] if the period allowed for laying and delivering accounts and reports in relation to[F251 that period] has already expired.

(6) [F254 A company's accounting reference period may not in any case, unless the company is in administration] under Part III of the Insolvency (Northern Ireland) Order 1989, be extended so as to exceed 18 months and a notice under this Article is ineffective if the current or previous accounting reference period as extended in accordance with the notice would exceed that limit.]

[F251 (7) In this Article "EEA undertaking" means an undertaking established under the law of any part of the United Kingdom or the law of any other EEA State.]

F250 mod. SR 1994/133

F251 SR 1997/314

F252 1990 NI 5

F253 Words in art. 233(4) substituted (27.3.2006) by Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)), arts. 1(3), 3(3), Sch. 2 para. 13(a); S.R. 2006/21, art. 2 (with S.R. 2006/22, arts. 2-7)

F254 Words in art. 233(6) substituted (27.3.2006) by Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)), arts. 1(3), 3(3), Sch. 2 para. 13(b); S.R. 2006/21, art. 2 (with S.R. 2006/22, arts. 2-7)

Annual accountsF1029 N.I.

F255 Duty to prepare individual accounts N.I.

234.—(1) The directors of every company shall prepare accounts for the company for each of its financial years.

Those accounts are referred to in this Part as the company's “individual accounts”.

(2) A company's individual accounts may be prepared—

(a) in accordance with Article 234A ( “Companies Order individual accounts”), or

(b) in accordance with international accounting standards ( “IAS individual accounts”).

This paragraph is subject to the following provisions of this Article and Article 235C.

(3) The individual accounts of a company that is a charity must be Companies Order individual accounts.

(4) After the first financial year in which the directors of a company prepare IAS individual accounts ( “the first IAS year”), all subsequent individual accounts of the company must be prepared in accordance with international accounting standards unless there is a relevant change of circumstance.

(5) There is a relevant change of circumstance if, at any time during or after the first IAS year—

(a) the company becomes a subsidiary undertaking of another undertaking that does not prepare IAS individual accounts,

(b) the company ceases to be a company with securities admitted to trading on a regulated market, or

(c) a parent undertaking of the company ceases to be an undertaking with securities admitted to trading on a regulated market.

In this paragraph “regulated market” has the same meaning as it has in Council Directive 93/22/EEC on investment services in the securities field.

(6) If, having changed to preparing Companies Order individual accounts following a relevant change of circumstance, the directors again prepare IAS individual accounts for the company, paragraphs (4) and (5) apply again as if the first financial year for which such accounts are again prepared were the first IAS year.

F255 Arts. 234-235C subst. for arts. 234, 235 by S.R. 2004/496, art. 2

F256 Companies Order individual accounts N.I.

234A.—(1) Companies Order individual accounts must comprise—

(a) a balance sheet as at the last day of the financial year, and

(b) a profit and loss account.

(2) The balance sheet must give a true and fair view of the state of affairs of the company as at the end of the financial year; and the profit and loss account must give a true and fair view of the profit or loss of the company for the financial year.

(3) Companies Order individual accounts must comply with the provisions of Schedule 4 as to the form and content of the balance sheet and profit and loss account and additional information to be provided by way of notes to the accounts.

(4) Where compliance with the provisions of that Schedule, and the other provisions of this Order as to the matters to be included in a company's individual accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

(5) If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the directors must depart from that provision to the extent necessary to give a true and fair view.

(6) Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

F256 Arts. 234-235C subst. for arts. 234, 235 by S.R. 2004/496, art. 2

F257 IAS individual accounts N.I.

234B.  Where the directors of a company prepare IAS individual accounts, they must state in the notes to those accounts that the accounts have been prepared in accordance with international accounting standards.

F257 Arts. 234-235C subst. for arts. 234, 235 by S.R. 2004/496, art. 2

[F258 F259 Duty to prepare group accounts N.I.

235.— (1) If at the end of a financial year a company is a parent company the directors, as well as preparing individual accounts for the year, shall prepare consolidated accounts for the group for the year. Those accounts are referred to in this Part as the company's “group accounts”.

(2) The group accounts of certain companies are required by Article 4 of the IAS Regulation to be prepared in accordance with international accounting standards ( “IAS group accounts”).

(3) The group accounts of other companies may be prepared—

(a) in accordance with Article 235A ( “Companies Order group accounts”), or

(b) in accordance with international accounting standards ( “IAS group accounts”).

This paragraph is subject to the following provisions of this Article.

(4) The group accounts of a parent company that is a charity must be Companies Order group accounts.

(5) After the first financial year in which the directors of a parent company prepare IAS group accounts ( “the first IAS year”), all subsequent group accounts of the company must be prepared in accordance with international accounting standards unless there is a relevant change of circumstance.

(6) There is a relevant change of circumstance if, at any time during or after the first IAS year—

(a) the company becomes a subsidiary undertaking of another undertaking that does not prepare IAS group accounts,

(b) the company ceases to be a company with securities admitted to trading on a regulated market, or

(c) a parent undertaking of the company ceases to be an undertaking with securities admitted to trading on a regulated market.

In this paragraph “regulated market” has the same meaning as it has in Council Directive 93/22/EEC on investment services in the securities field.

(7) If, having changed to preparing Companies Order group accounts following a relevant change of circumstance, the directors again prepare IAS group accounts for the company, paragraphs (5) and (6) apply again as if the first financial year for which such accounts are again prepared were the first IAS year.

(8) This Article is subject to the exemptions provided by Articles 236, 236A, 237(5) and 256.]

F258 1990 NI 5, art. 7(1)

F259 Arts. 234-235C subst. for arts. 234, 235 by S.R. 2004/496, art. 2

F260 Companies Order group accounts N.I.

235A.—(1) Companies Order group accounts must comprise—

(a) a consolidated balance sheet dealing with the state of affairs of the parent company and its subsidiary undertakings, and

(b) a consolidated profit and loss account dealing with the profit or loss of the parent company and its subsidiary undertakings.

(2) The accounts must give a true and fair view of the state of affairs as at the end of the financial year, and the profit or loss for the financial year, of the undertakings included in the consolidation as a whole, so far as concerns members of the company.

(3) Companies Order group accounts must comply with the provisions of Schedule 4A as to the form and content of the consolidated balance sheet and consolidated profit and loss account and additional information to be provided by way of notes to the accounts.

(4) Where compliance with the provisions of that Schedule, and the other provisions of this Order as to the matters to be included in a company's group accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

(5) If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the directors must depart from that provision to the extent necessary to give a true and fair view.

(6) Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

F260 Arts. 234-235C subst. for arts. 234, 235 by S.R. 2004/496, art. 2

F261 IAS group accounts N.I.

235B.  Where the directors of a parent company prepare IAS group accounts, they must state in the notes to those accounts that the accounts have been prepared in accordance with international accounting standards.

F261 Arts. 234-235C subst. for arts. 234, 235 by S.R.2004/496, art. 2

F262 Consistency of accounts N.I.

235C.—(1) Subject to the following provisions of this Article, the directors of a parent company must secure that the individual accounts of—

(a) the parent company, and

(b) each of its subsidiary undertakings,

are all prepared using the same financial reporting framework, except to the extent that in their opinion there are good reasons for not doing so.

(2) Paragraph (1) does not apply if the directors do not prepare group accounts for the parent company.

(3) Paragraph (1) only applies to accounts of subsidiary undertakings that are required to be prepared under this Part.

(4) Paragraph (1) does not require accounts of undertakings that are charities to be prepared using the same financial reporting framework as accounts of undertakings which are not charities.

(5) Paragraph (1)(a) does not apply where the directors of a parent company prepare IAS group accounts and IAS individual accounts.

F262 Arts. 234-235C subst. for arts. 234, 235 by S.R.2004/496, art. 2

[F263 Exemption for parent companies included in accounts of larger group N.I.

236 .F264 — (1) A company is exempt from the requirement to prepare group accounts if it is itself a subsidiary undertaking and its immediate parent undertaking is established under the law of[F265 an EEA state], in the following cases—

(a) where the company is a wholly‐owned subsidiary of that parent undertaking;

(b) where that parent undertaking holds more than 50 per cent. of the shares in the company and notice requesting the preparation of group accounts has not been served on the company by shareholders holding in aggregate—

(i) more than half of the remaining shares in the company, or

(ii) 5 per cent. of the total shares in the company.

Such notice must be served not later than 6 months after the end of the financial year before that to which it relates.

(2) Exemption is conditional upon compliance with all of the following conditions—

(a) that the company is included in consolidated accounts for a larger group drawn up to the same date, or to an earlier date in the same financial year, by a parent undertaking established under the law of[F265 an EEA state];

(b) that those accounts are drawn up and audited, and that parent undertaking's annual report is drawn up, according to that law, in accordance with the provisions of the Seventh Directive (83/349/EEC)[F266 (where applicable as modified by the provisions of the Bank Accounts Directive (86/635/EEC))][F267 or the Insurance Accounts Directive (91/674/EEC)][F265 or in accordance with international accounting standards];

(c) that the company discloses in its individual accounts that it is exempt from the obligation to prepare and deliver group accounts;

(d) that the company states in its individual accounts the name of the parent undertaking which draws up the group accounts referred to above and—

(i) if it is incorporated outside Northern Ireland, the country in which it is incorporated, and

(ii) if it is unincorporated, the address of its principal place of business;

(e) that the company delivers to the registrar, within the period allowed for delivering its individual accounts, copies of those group accounts and of the parent undertaking's annual report, together with the auditors' report on them; and

(f) that if any document comprised in accounts and reports delivered in accordance with sub‐paragraph (e) is in a language other than English, there is annexed to the copy of that document delivered a translation of it into English, certified in the prescribed manner to be a correct translation.

(3) The exemption does not apply to a company any of whose securities areF265 . . . [F265 admitted to trading on a regulated market of any EEA State within the meaning of Council Directive 93/22/EEC on investment services in the securities field].

(4) Shares held by directors of a company for the purpose of complying with any share qualification requirement shall be disregarded in determining for the purposes of paragraph (1)(a) whether the company is a wholly‐owned subsidiary.

(5) For the purposes of paragraph (1)(b) shares held by a wholly‐owned subsidiary of the parent undertaking, or held on behalf of the parent undertaking or a wholly‐owned subsidiary, shall be attributed to the parent undertaking.

(6) In paragraph (3) “securities” includes—

(a) shares and stock,

(b) debentures, including debenture stock, loan stock, bonds, certificates of deposit and other instruments creating or acknowledging indebtedness,

(c) warrants or other instruments entitling the holder to subscribe for securities falling within sub‐paragraph (a) or (b), and

(d) certificates or other instruments which confer—

(i) property rights in respect of a security falling within sub‐paragraph (a), (b) or (c),

(ii) any right to acquire, dispose of, underwrite or convert a security, being a right to which the holder would be entitled if he held any such security to which the certificate or other instrument relates, or

(iii) a contractual right (other than an option) to acquire any such security otherwise than by subscription.]

F263 1990 NI 5, art. 7(3)

F264 mod. SR 1994/133

F265 SR 2004/496

F266 SR 1993/199

F267 SR 1994/428

[F268 Exemption for parent companies included in non‐EEA group accounts N.I.

236A.— (1) A company is exempt from the requirement to prepare group accounts if it is itself a subsidiary undertaking and its parent undertaking is not established under the law of an EEA State, in the following cases—

(a) where the company is a wholly-owned subsidiary of that parent undertaking;

(b) where that parent undertaking holds more than 50 per cent of the shares in the company and notice requesting the preparation of group accounts has not been served on the company by shareholders holding in aggregate—

(i) more than half of the remaining shares in the company, or

(ii) 5 per cent of the total shares in the company.

Such notice must be served not later than six months after the end of the financial year before that to which it relates.

(2) Exemption is conditional upon compliance with all of the following conditions—

(a) that the company and all of its subsidiary undertakings are included in consolidated accounts for a larger group drawn up to the same date, or to an earlier date in the same financial year, by a parent undertaking;

(b) that those accounts and, where appropriate, the group's annual report, are drawn up in accordance with the provisions of the Seventh Directive (83/349/EEC) (where applicable as modified by the provisions of the Bank Accounts Directive (86/635/EEC) or the Insurance Accounts Directive (91/674/EEC)), or in a manner equivalent to consolidated accounts and consolidated annual reports so drawn up;

(c) that the consolidated accounts are audited by one or more persons authorised to audit accounts under the law under which the parent undertaking which draws them up is established;

(d) that the company discloses in its individual accounts that it is exempt from the obligation to prepare and deliver group accounts;

(e) that the company states in its individual accounts the name of the parent undertaking which draws up the group accounts referred to above and—

(i) if it is incorporated outside Northern Ireland, the country in which it is incorporated, and

(ii) if it is unincorporated, the address of its principal place of business;

(f) that the company delivers to the registrar, within the period allowed for delivering its individual accounts, copies of the group accounts and, where appropriate, of the consolidated annual report, together with the auditors' report on them.

(3) The exemption does not apply to a company any of whose securities are admitted to trading on a regulated market of any EEA State within the meaning of Council Directive 93/22/EEC on investment services in the securities field.

(4) Shares held by directors of a company for the purposes of complying with any share qualification requirement are disregarded in determining for the purposes of paragraph (1)(a) whether the company is a wholly-owned subsidiary.

(5) For the purposes of paragraph (1)(b), shares held by a wholly-owned subsidiary of the parent undertaking or held on behalf of the parent undertaking or a wholly-owned subsidiary, are attributed to the parent undertaking.

(6) In paragraph (3) “securities” includes—

(a) shares and stock,

(b) debentures, including debenture stock, loan stock, bonds, certificates of deposit and other instruments creating or acknowledging indebtedness,

(c) warrants or other instruments entitling the holder to subscribe for securities falling within sub-paragraph (a) or (b), and

(d) certificates or other instruments which confer—

(i) property rights in respect of a security falling within sub-paragraph (a), (b) or (c),

(ii) any right to acquire, dispose of, underwrite or convert a security, being a right to which the holder would be entitled if he held any such security to which the certificate or other instrument relates, or

(iii) a contractual right (other than an option) to acquire any such security otherwise than by subscription.]

F268 Art. 236A inserted by S.R. 2004/496, art. 4.

[F269 Subsidiary undertakings included in the consolidation N.I.

237 .F270 — (1) [F271 In the case of Companies Order group accounts,] Subject to the exceptions authorisedF271 . . . by this Article, all the subsidiary undertakings of the parent company shall be included in the consolidation.

(2) A subsidiary undertaking may be excluded from consolidation[F271 in Companies Order group accounts] if its inclusion is not material for the purpose of giving a true and fair view; but two or more undertakings may be excluded only if they are not material taken together.

(3) In addition, a subsidiary undertaking may be excluded from consolidation[F271 in Companies Order group accounts] where—

(a) severe long‐term restrictions substantially hinder the exercise of the rights of the parent company over the assets or management of that undertaking, or

(b) the information necessary for the preparation of group accounts cannot be obtained without disproportionate expense or undue delay, or

(c) the interest of the parent company is held exclusively with a view to subsequent resaleF271 . . . .

The reference in sub‐paragraph (a) to the rights of the parent company and the reference in sub‐paragraph (c) to the interest of the parent company are, respectively, to rights and interests held by or attributed to the company for the purposes of Article 266 (definition of “parent undertaking”) in the absence of which it would not be the parent company.

• Para. (4) rep. by SR 2004/496

• This paragraph does not apply merely because some of the undertakings are industrial, some commercial and some provide services, or because they carry on industrial or commercial activities involving different products or provide different services.

[F271 (5) A parent company is exempt from the requirement to prepare group accounts if under paragraph (2) or (3) all of its subsidiary undertakings could be excluded from consolidation in Companies Order group accounts.]]

F269 1990 NI 5, art. 7(3)

F270 mod. SR 1994/133

F271 SR 2004/496

[F272 Treatment of individual profit and loss account where group accounts prepared N.I.

238 .F273 — (1) The following provisions apply with respect to the individual profit and loss account of a parent company where—

(a) the company is required to prepare and does prepare group accounts in accordance with this Order, and

(b) the notes to the company's individual balance sheet show the company's profit or loss for the financial year determined in accordance with this Order.

(2) [F274 Where the company prepares Companies Order individual accounts,] The profit and loss account need not contain the information specified in paragraphs 52 to 57 of Schedule 4 (information supplementing the profit and loss account).

(3) The profit and loss account must be approved in accordance with Article 241(1) (approval by board of directors) but may be omitted from the company's annual accounts for the purposes of the other provisions below in this Chapter.

(4) The exemption conferred by this Article is conditional upon its being disclosed in the company's annual accounts that the exemption applies.]

F272 Art. 238 inserted by 1990 NI 5, art. 7(4)

F273 mod. SR 1994/133

F274 SR 2004/496

[F275 Disclosure required in notes to accounts: related undertakings N.I.

239 .F276 — (1) The information specified in Schedule 5 shall be given in notes to a company's annual accounts.

(2) Where the company is not required to prepare group accounts, the information specified in Part I of that Schedule shall be given; and where the company is required to prepare group accounts, the information specified in Part II of that Schedule shall be given.

(3) The information required by Schedule 5 need not be disclosed with respect to an undertaking which—

(a) is established under the law of a country outside the United Kingdom, or

(b) carries on business outside the United Kingdom,

if in the opinion of the directors of the company the disclosure would be seriously prejudicial to the business of that undertaking, or to the business of the company or any of its subsidiary undertakings, and the Department agrees that the information need not be disclosed.

This paragraph does not apply in relation to the information required under[F277 paragraphF278 . . . 6, 9A, 20 or 28A] of that Schedule.

(4) Where advantage is taken of paragraph (3), that fact shall be stated in a note to the company's annual accounts.

(5) If the directors of the company are of the opinion that the number of undertakings in respect of which the company is required to disclose information under any provision of Schedule 5 is such that compliance with that provision would result in information of excessive length being given, the information need only be given in respect of—

(a) the undertakings whose results or financial position, in the opinion of the directors, principally affected the figures shown in the company's annual accounts, and

(b) undertakings excluded from consolidation under Article 237(3)F279 . . . .

F278 . . .

(6) If advantage is taken of paragraph (5)—

(a) there shall be included in the notes to the company's annual accounts a statement that the information is given only with respect to such undertakings as are mentioned in that paragraph, and

(b) the full information (both that which is disclosed in the notes to the accounts and that which is not) shall be annexed to the company's next annual return.

For this purpose the “next annual return” means that next delivered to the registrar after the accounts in question have been approved under Article 241.

(7) If a company fails to comply with paragraph (6)(b), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.]

F275 1990 NI 5, art. 8(1)

F276 mod. SR 1994/133

F277 SR 1994/133

F278 SR 1997/314

F279 SR 2004/496

[F280 Disclosure required in notes to annual accounts: particulars of staff N.I.

239A.— (1) The following information with respect to the employees of the company must be given in notes to the company's annual accounts—

(a) the average number of persons employed by the company in the financial year, and

(b) the average number of persons so employed within each category of persons employed by the company.

(2) The average number required by paragraph (1)(a) or (b) is determined by dividing the relevant annual number by the number of months in the financial year.

(3) The relevant annual number is determined by ascertaining for each month in the financial year—

(a) for the purposes of paragraph (1)(a), the number of persons employed under contracts of service by the company in that month (whether throughout the month or not);

(b) for the purposes of paragraph (1)(b), the number of persons in the category in question of persons so employed;

and, in either case, adding together all the monthly numbers.

(4) In respect of all persons employed by the company during the financial year who are taken into account in determining the relevant annual number for the purposes of paragraph (1)(a) there must also be stated the aggregate amounts respectively of—

(a) wages and salaries paid or payable in respect of that year to those persons;

(b) social security costs incurred by the company on their behalf; and

(c) other pension costs so incurred.

This does not apply in so far as those amounts, or any of them, are stated elsewhere in the company's accounts.

(5) For the purposes of paragraph (1)(b), the categories of person employed by the company are such as the directors may select, having regard to the manner in which the company's activities are organised.

(6) This Article applies in relation to group accounts as if the undertakings included in the consolidation were a single company.

(7) In this Article “social security costs” and “pension costs” have the same meaning as in Schedule 4 (see paragraph 92(1) and (2) of that Schedule).]

F280 Art. 239A inserted by SR 2004/496, art. 11

[F281 Disclosure required in notes to accounts: emoluments and other benefits of directors and others N.I.

240 .F282 — [F283 (1) The information specified in Schedule 6 shall be given in notes to a company's annual accounts, save that the information specified in paragraphs 2 to 14 in Part I of Schedule 6 shall be given only in the case of a company which is not a quoted company.]

(2) In that Schedule—

• Part I relates to the emoluments of directors (including emoluments waived), pensions of directors and past directors, compensation for loss of office to directors and past directors and sums paid to third parties in respect of directors' services,

• Part II relates to loans, quasi‐loans and other dealings in favour of directors and connected persons, and

• Part III relates to transactions, arrangements and agreements made by the company or a subsidiary undertaking for officers of the company other than directors.

(3) It is the duty of any director of a company, and any person who is or has at any time in the preceding 5 years been an officer of the company, to give notice to the company of such matters relating to himself as may be necessary for the purposes of Part I of Schedule 6.

(4) A person who makes default in complying with paragraph (3) commits an offence and is liable to a fine.]

F281 1990 NI 5, art. 8(3)

F282 mod. SR 1994/133

F283 SR 2005/56

Approval and signing of accountsF1029 N.I.

Approval and signing of accounts N.I.

241 .F284 —(1) A company's annual accounts shall be approved by the board of directors and signed on behalf of the board by a director of the company.

(2) The signature shall be on the company's balance sheet.

(3) Every copy of the balance sheet which is laid before the company in general meeting, or which is otherwise circulated, published or issued, shall state the name of the person who signed the balance sheet on behalf of the board.

(4) The copy of the company's balance sheet which is delivered to the registrar shall be signed on behalf of the board by a director of the company.

(5) If annual accounts are approved which do not comply with the requirements of this Order[F285 (or, where applicable, of Article 4 of the IAS Regulation)], every director of the company who is party to their approval and who knows that they do not comply or is reckless as to whether they comply is guilty of an offence and liable to a fine.

For this purpose every director of the company at the time the accounts are approved shall be taken to be a party to their approval unless he shows that he took all reasonable steps to prevent their being approved.

(6) If a copy of the balance sheet—

(a) is laid before the company, or otherwise circulated, published or issued, without the balance sheet having been signed as required by this Article or without the required statement of the signatory's name being included, or

(b) is delivered to the registrar without being signed as required by this Article,

the company and every officer of it who is in default is guilty of an offence and liable to a fine.

F284 mod. SR 1994/133

F285 SR 2004/496

DIRECTORS' REPORTF1029 N.I.

Duty to prepare directors' report N.I.

242.—(1) The directors of a company shall for each financial year prepare a report (a “directors' report”) complying with the general requirements of Article 242ZZA, F286 . . .

(2) For a financial year in which—

(a) the company is a parent company, and

(b) the directors of the company prepare group accounts,

the directors' report must be a consolidated report (a “group directors' report”) relating, to the extent specified in the following provisions of this Part, to the company and its subsidiary undertakings included in the consolidation.

(3) A group directors' report may, where appropriate, give greater emphasis to the matters that are significant to the company and its subsidiary undertakings included in the consolidation, taken as a whole.

(4) F287 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) If a directors' report does not comply with the provisions of this Part relating to the preparation and contents of the report, every director of the company who—

(a) knew that it did not comply or was reckless as to whether it complied, and

(b) failed to take all reasonable steps to secure compliance with the provision in question,

is guilty of an offence and liable to a fine.

F286 Words in art. 242(1) repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 43(2))

F287 Art. 242(4) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 1

Directors' report: general requirements N.I.

242ZZA.—(1) The directors' report for a financial year must state—

(a) the names of the persons who, at any time during the financial year, were directors of the company,

(b) the principal activities of the company in the course of the year, and

(c) the amount (if any) that the directors recommend should be paid by way of dividend.

(2) In relation to a group directors' report paragraph (1)(b) has effect as if the reference to the company was a reference to the company and its subsidiary undertakings included in the consolidation.

(3) The report must also comply with Schedule 7 as regards the disclosure of the matters mentioned there.

(4) In Schedule 7—

• Part I relates to matters of a general nature, including changes in asset values, directors' shareholdings and other interests and contributions for political and charitable purposes;

• Part II relates to the acquisition by a company of its own shares or a charge on them;

• Part III relates to the employment, training and advancement of disabled persons;

• Part V relates to the involvement of employees in the affairs, policy and performance of the company;

• Part VI relates to the company's policy and practice on the payment of creditors.

Directors' report: business review N.I.

242ZZB.  F288 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F288 Art. 242ZZB repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 43(2))

F289 prosp. rep. by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

Approval and signing of directors' report N.I.

242A .F290 —(1) The directors' report shall be approved by the board of directors and signed on behalf of the board by a director or the secretary of the company.

(2) Every copy of the directors' report which is laid before the company in general meeting, or which is otherwise circulated, published or issued, shall state the name of the person who signed it on behalf of the board.

(3) The copy of the directors' report which is delivered to the registrar shall be signed on behalf of the board by a director or the secretary of the company.

(4) If a copy of the directors' report—

(a) is laid before the company, or otherwise circulated, published or issued, without the report having been signed as required by this Article or without the required statement of the signatory's name being included, or

(b) is delivered to the registrar without being signed as required by this Article,

the company and every officer of it who is in default is guilty of an offence and liable to a fine.

F290 mod. SR 1994/133

F291 . . . F1029 N.I.

F291 Heading before art. 242AA omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 2

Duty to prepare operating and financial review N.I.

242AA.  F292 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F292 Art. 242AA repealed (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(1)

Approval and signing of operating and financial review N.I.

242AB.  F293 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F293 Art. 242AB omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 3

Quoted companies: directors' remuneration reportF1029 N.I.

Duty to prepare directors' remuneration report N.I.

242B.—(1) The directors of a quoted company shall for each financial year prepare a directors' remuneration report which shall contain the information specified in Schedule 7A and comply with any requirement of that Schedule as to how information is to be set out in the report.

(2) In Schedule 7A—

• Part I is introductory,

• Part II relates to information about remuneration committees, performance related remuneration and liabilities in respect of directors' contracts,

• Part III relates to detailed information about directors' remuneration (information included under Part III is required to be reported on by the auditors, see Article 243), and

• Part IV contains interpretative and supplementary provisions.

(3) In the case of any failure to comply with the provisions of this Part as to the preparation of a directors' remuneration report and the contents of the report, every person who was a director of the quoted company immediately before the end of the period for laying and delivering accounts and reports for the financial year in question is guilty of an offence and liable to a fine.

(4) In proceedings against a person for an offence under paragraph (3) it is a defence for him to prove that he took all reasonable steps for securing compliance with the requirements in question.

(5) It is the duty of any director of a company, and any person who has at any time in the preceding five years been a director of the company, to give notice to the company of such matters relating to himself as may be necessary for the purposes of Parts II and III of Schedule 7A.

(6) A person who makes default in complying with paragraph (5) commits an offence and is liable to a fine.

Approval and signing of directors' remuneration report N.I.

242C.—(1) The directors' remuneration report shall be approved by the board of directors and signed on behalf of the board by a director or the secretary of the company.

(2) Every copy of the directors' remuneration report which is laid before the company in general meeting, or which is otherwise circulated, published or issued, shall state the name of the person who signed it on behalf of the board.

(3) The copy of the directors' remuneration report which is delivered to the registrar shall be signed on behalf of the board by a director or the secretary of the company.

(4) If a copy of the directors' remuneration report—

(a) is laid before the company, or otherwise circulated, published or issued, without the report having been signed as required by this Article or without the required statement of the signatory's name being included, or

(b) is delivered to the registrar without being signed as required by this Article,

the company and every officer of it who is in default is guilty of an offence and liable to a fine.

[F294 Auditors' report]F1029 N.I.

F294 1990 NI 5

Auditors' report N.I.

243 .F295 —(1) A company's auditors shall make a report to the company's members on all annual accounts of the company of which copies [F296 are, during their tenure of office—

(a) in the case of a private company, to be sent out to members under Article 246(1);

(b) in the case of a public company, to be laid before the company in general meeting under Article 249.]

[F297 (1A) The auditors' report must include—

(a) an introduction identifying the annual accounts that are the subject of the audit and the financial reporting framework that has been applied in their preparation;

(b) a description of the scope of the audit identifying the auditing standards in accordance with which the audit was conducted.

(1B) The report must state clearly whether in the auditors' opinion the annual accounts have been properly prepared in accordance with the requirements of this Order (and, where applicable, Article 4 of the IAS Regulation).

(2) The report must state in particular whether the annual accounts give a true and fair view, in accordance with the relevant financial reporting framework—

(a) in the case of an individual balance sheet, of the state of affairs of the company as at the end of the financial year,

(b) in the case of an individual profit and loss account, of the profit or loss of the company for the financial year,

(c) in the case of group accounts, of the state of affairs as at the end of the financial year and of the profit or loss for the financial year, of the undertakings included in the consolidation as a whole, so far as concerns members of the company.

(2A) The auditors' report—

(a) must be either unqualified or qualified, and

(b) must include a reference to any matters to which the auditors wish to draw attention by way of emphasis without qualifying the report.]

[F298 (3) The auditors must state in their report whether in their opinion the information given in the directors' report for the financial year for which the annual accounts are prepared is consistent with those accounts.]

(3A) F299 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F300 (4) If a director's remuneration report is prepared for the financial year for which the annual accounts are prepared the auditors shall in their report—

(a) report to the company's members on the auditable part of the directors' remuneration report, and

(b) state whether in their opinion that part of the directors' remuneration report has been properly prepared in accordance with this Order.

(5) For the purposes of this Part, “the auditable part” of a directors' remuneration report is the part containing the information required by Part III of Schedule 7A.]

F295 mod. SR 1994/133

F296 Words in art. 243(1) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(1) (with art. 12)

F297 SR 2004/496

F298 SR 2005/61

F299 Art. 243(3A) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 4

F300 SR 2005/56

Signature of auditors' report N.I.

244 .F301 —(1) The auditors' report shall state the names of the auditors and be signed [F302 and dated] by them.

(2) Every copy of the auditors' report which is laid before the company in general meeting, or which is otherwise circulated, published or issued, shall state the names of the auditors.

(3) The copy of the auditors' report which is delivered to the registrar shall state the names of the auditors and be signed by them.

(4) If a copy of the auditors' report—

(a) is laid before the company, or otherwise circulated, published or issued, without the required statement of the auditors' names, or

(b) is delivered to the registrar without the required statement of the auditors' names or without being signed as required by this Article,

the company and every officer of it who is in default is guilty of an offence and liable to a fine.

(5) References in this Article to signature by the auditors are, where the office of auditor is held by a body corporate or partnership, to signature in the name of the body corporate or partnership by a person authorised to sign on its behalf.

F301 mod. SR 1994/133

F302 SR 2004/496

Duties of auditors N.I.

245 .F303 —(1) A company's auditors shall, in preparing their report, carry out such investigations as will enable them to form an opinion as to—

(a) whether proper accounting records have been kept by the company and proper returns adequate for their audit have been received from branches not visited by them, and

(b) whether the company's individual accounts are in agreement with the accounting records and returnsF304 . . . [F304 , and]

[F304 (c) (in the case of a quoted company) whether the auditable part of the company's directors' remuneration report is in agreement with the accounting records and returns.]

(2) If the auditors are of opinion that proper accounting records have not been kept, or that proper returns adequate for their audit have not been received from branches not visited by them, or if the company's individual accounts are not in agreement with the accounting records and returns,[F304 or if in the case of a quoted company the auditable part of its directors' remuneration report is not in agreement with the accounting records and returns,] the auditors shall state that fact in their report.

(3) If the auditors fail to obtain all the information and explanations which, to the best of their knowledge and belief, are necessary for the purposes of their audit, they shall state that fact in their report.

[F304 (4) If—

(a) the requirements of Schedule 6 (disclosure of information: emoluments and other benefits of directors and others) are not complied with in the annual accounts, or

(b) where a directors' remuneration report is required to be prepared, the requirements of Part III of Schedule 7A (directors' remuneration report) are not complied with in that report,

the auditors shall include in their report, so far as they are reasonably able to do so, a statement giving the required particulars.]

[F305 (5) If the directors of the company have taken advantage of the exemption conferred by Article 256 (exemption for small and medium‐sized groups from the need to prepare group accounts) and in the auditors' opinion they were not entitled so to do, the auditors shall state that fact in their report.]

F303 mod. SR 1994/133

F304 SR 2005/56

F305 SR 1997/314

[F306 Publication of accounts and reports]F1029 N.I.

F306 1990 NI 5

Persons entitled to receive copies of accounts and reports N.I.

246 .F307 — [F308 (1) [F309 A copy of each of the documents mentioned in paragraph (1A),] shall be sent to—

(a) every member of the company,

(b) every holder of the company's debentures, and

(c) every person who is entitled to receive notice of general meetings,

F310 . . .

[F309 (1A) Those documents are—

(a) the company's annual accounts for the financial year,

(b) the directors' report for that financial year,

(ba) F311 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) (in the case of a quoted company) the directors' remuneration report for that financial year, and

[F312 (d) the auditors' report on those accounts and that directors' report and (in the case of a quoted company) on F313 . . . the auditable part of that directors' remuneration report.]]

(2) Copies need not be sent—

(a) to a person who is not entitled to receive notices of general meetings and of whose address the company is unaware, or

(b) to more than one of the joint holders of shares or debentures none of whom is entitled to receive such notices, or

(c) in the case of joint holders of shares or debentures some of whom are, and some not, entitled to receive such notices, to those who are not so entitled.

(3) In the case of a company not having a share capital, copies need not be sent to anyone who is not entitled to receive notices of general meetings of the company.

(4) F314 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F315 (4A) References in this Article to sending to any person copies of[F309 the documents mentioned in paragraph (1A)] include references to using electronic communications for sending copies of those documents to such address as may for the time being be notified to the company by that person for that purpose.

(4B) For the purposes of this Article copies of those documents are also to be treated as sent to a person where—

(a) the company and that person have agreed to his having access to the documents on a web site (instead of their being sent to him);

(b) the documents are documents to which that agreement applies; and

(c) that person is notified, in a manner for the time being agreed for the purpose between him and the company, of—

(i) the publication of the documents on a web site;

(ii) the address of that web site; and

(iii) the place on that web site where the documents may be accessed, and how they may be accessed.

(4C) For the purposes of this Article documents treated in accordance with paragraph (4B) as sent to any person are to be treated as sent to him not less than 21 days before the date of a meeting if, and only if—

(a) the documents are published on the web site throughout a period beginning at least 21 days before the date of the meeting and ending with the conclusion of the meeting; and

(b) the notification given for the purposes of sub-paragraph (c) of that paragraph is given not less than 21 days before the date of the meeting.

(4D) Nothing in paragraph (4C) shall invalidate the proceedings of a meeting where—

(a) any documents that are required to be published as mentioned in sub-paragraph (a) of that paragraph are published for a part, but not all, of the period mentioned in that sub-paragraph; and

(b) the failure to publish those documents throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the company to prevent or avoid.

(4E) A company may, notwithstanding any provision to the contrary in its articles, take advantage of any of paragraphs (4A) to (4D).]

(5) If default is made in complying with this Article [F316 or Article 246A], the company and every officer of it who is in default is guilty of an offence and liable to a fine.

(6) Where copies are sent out under this Article over a period of days, references elsewhere in this Order to the day on which copies are sent out shall be construed as references to the last day of that period.]

F307 mod. SR 1994/133

F308 Art. 246 repealed (20.1.2007 for art. 246(4A)-(4E) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

F309 SR 2005/56

F310 Words in art. 246(1) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(2)(a) (with art. 12)

F311 Art. 246(1A)(ba) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 5(a)

F312 SR 2005/61

F313 Words in art. 246(1A)(d) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 5(b)

F314 Art. 246(4) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(2)(b) (with art. 12)

F315 SR 2003/3

F316 Words in art. 246(5) inserted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(2)(c) (with art. 12)

Time allowed for sending out copies of accounts and reports N.I.

246A.—(1) The time allowed for sending out copies of the company's annual accounts and reports is as follows.

(2) A private company must comply with Article 246(1) not later than—

(a) the end of the period for delivering accounts (see Article 252), or

(b) if earlier, the date on which it actually delivers its accounts and reports under Article 250.

(3) A public company must comply with Article 246(1) not less than 21 days before the date of the meeting at which copies of the documents are to be laid in accordance with Article 249.

(4) If in the case of a public company copies are sent out later than is required by paragraph (3), they shall, despite that, be deemed to have been duly sent if it is so agreed by all the members entitled to attend and vote at the meeting.

Right to demand copies of accounts and reports N.I.

247 .F317 — [F318 (1) Any member of a company and any holder of a company's debentures is entitled to be furnished, on demand and without charge,[F319 with a copy of—

(a) the company's last annual accounts,

(b) the last directors' report,

(ba) F320 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) (in the case of a quoted company) the last directors' remuneration report, and

[F321 (d) the auditors' report on those accounts and that directors' report and (in the case of a quoted company) on F322 . . . the auditable part of that directors' remuneration report.]]

(2) The entitlement under this Article is to a single copy of those documents, but that is in addition to any copy to which a person may be entitled under Article 246.

[F323 (2A) Any obligation by virtue of paragraph (1) to furnish a person with a document may be complied with by using electronic communications for sending that document to such address as may for the time being be notified to the company by that person for that purpose.

(2B) A company may, notwithstanding any provision to the contrary in its articles, take advantage of paragraph (2A).]

(3) If a demand under this Article is not complied with within 7 days, the company and every officer of it who is in default is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(4) If in proceedings for such an offence the issue arises whether a person had already been furnished with a copy of the relevant document under this Article, it is for the defendant to prove that he had.]

F317 mod. SR 1994/133

F318 Art. 247 repealed (20.1.2007 for art. 247(2A)(2B) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

F319 SR 2005/56

F320 Art. 247(1)(ba) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 6(a)

F321 SR 2005/61

F322 Words in art. 247(1)(d) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 6(b)

F323 SR 2003/3

Requirements in connection with publication of accounts N.I.

248 .F324 —(1) If a company publishes any of its statutory accounts, they must be accompanied by the relevant auditors' report under Article 243 [F325 or, as the case may be, the relevant report made for the purposes of Article 257A(2)].

(2) A company which is required to prepare group accounts for a financial year shall not publish its statutory individual accounts for that year without also publishing with them its statutory group accounts.

(3) If a company publishes non‐statutory accounts, it shall publish with them a statement indicating—

(a) that they are not the company's statutory accounts,

(b) whether statutory accounts dealing with any financial year with which the non‐statutory accounts purport to deal have been delivered to the registrar,

(c) whether the company's auditors have made a report under Article 243 on the statutory accounts for any such financial year[F325 and, if no such report has been made, whether the company's reporting accountant has made a report for the purposes of Article 257A(2) on the statutory accounts for any such financial year],F326 . . .

[F326 (d) whether any such auditors' report—

(i) was qualified or unqualified, or included a reference to any matters to which the auditors drew attention by way of emphasis without qualifying the report, or

(ii) contained a statement under Article 245(2) or (3) (accounting records or returns inadequate, accounts not agreeing with records and returns or failure to obtain necessary information and explanations); and

(e) whether any report made for the purposes of Article 257A(2) was qualified;]

and it shall not publish with the non‐statutory accounts any auditors' report under Article 243[F325 or any report made for the purposes of Article 257A(2)].

(4) For the purposes of this Article a company shall be regarded as publishing a document if it publishes, issues or circulates it or otherwise makes it available for public inspection in a manner calculated to invite members of the public generally, or any class of members of the public, to read it.

(5) References in this Article to a company's statutory accounts are to its individual or group accounts for a financial year as required to be delivered to the registrar under Article 250; and references to the publication by a company of “non‐statutory accounts” are to the publication of—

(a) any balance sheet or profit and loss account relating to, or purporting to deal with, a financial year of the company, or

(b) an account in any form purporting to be a balance sheet or profit and loss account for the group consisting of the company and its subsidiary undertakings relating to, or purporting to deal with, a financial year of the company,

otherwise than as part of the company's statutory accounts.

(6) A company which contravenes any provision of this Article, and any officer of it who is in default, is guilty of an offence and liable to a fine.

F324 mod. SR 1994/133

F325 SR 1995/128

F326 SR 2004/496

[F327 Laying and delivering of accounts and reports]F1029 N.I.

F327 1990 NI 5

[F328 Accounts and reports to be laid before company in general meeting N.I.

249 .F329 — [F330 (1) The directors of [F331 a public company] shall in respect of each financial year lay before the company in general meeting[F332 copies of—

(a) the company's annual accounts,

(b) the directors' report,

(ba) F333 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) (in the case of a quoted company) the directors' remuneration report, and

[F334 (d) the auditors' report on those accounts and that directors' report and (in the case of a quoted company) on F335 . . . the auditable part of that directors' remuneration report.]]

(2) If the requirements of paragraph (1) are not complied with before the end of the period allowed for laying and delivering accounts and reports, every person who immediately before the end of that period was a director of the company is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(3) It is a defence for a person charged with such an offence to prove that he took all reasonable steps for securing that those requirements would be complied with before the end of that period.

(4) It is not a defence to prove that the documents in question were not in fact prepared as required by this Part.]]

F328 Arts. 249, 250, 250A, 251, 252 and cross-heading inserted by 1990 NI 5, art. 13

F329 mod. SR 1994/133

F330 Art. 249 repealed (1.10.2007 for certain purposes and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

F331 Words in art. 249(1) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(5) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(5) (with art. 12)

F332 SR 2005/56

F333 Art. 249(1)(ba) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 7(a)

F334 SR 2005/61

F335 Words in art. 249(1)(d) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 7(b)

[F336 Members' approval of directors' remuneration report N.I.

249A.— (1) This Article applies to every company that is a quoted company immediately before the end of a financial year.

(2) In this Article “the meeting” means the general meeting of the company before which the company's annual accounts for the financial year are to be laid.

(3) The company must, prior to the meeting, give to the members of the company entitled to be sent notice of the meeting notice of the intention to move at the meeting, as an ordinary resolution, a resolution approving the directors' remuneration report for the financial year.

(4) Notice under paragraph (3) shall be given to each such member in any manner permitted for the service on him of notice of the meeting.

(5) The business that may be dealt with at the meeting includes the resolution.

(6) The existing directors must ensure that the resolution is put to the vote of the meeting.

(7) Paragraph (5) has effect notwithstanding—

(a) any default in complying with paragraphs (3) and (4);

(b) anything in the company's articles.

(8) No entitlement of a person to remuneration is made conditional on the resolution being passed by reason only of the provision made by this Article.

(9) In the event of default in complying with the requirements of paragraphs (3) and (4), every officer of the company who is in default is guilty of an offence and liable to a fine.

(10) If the resolution is not put to the vote of the meeting, each existing director is guilty of an offence and liable to a fine.

(11) If an existing director is charged with an offence under paragraph (10), it is a defence for him to prove that he took all reasonable steps for securing that the resolution was put to the vote at the meeting.

(12) In this Article “existing director” means a person who, immediately before the meeting, is a director of the company.]

F336 Art. 249A inserted by SR 2005/56, reg. 7

[F337 Accounts and reports to be delivered to the registrar N.I.

250 .F338 — (1 )F339  The directors of a company shall in respect of each financial year deliver to the registrar[F340 a copy of—

(a) the company's annual accounts,

(b) the directors' report,

(ba) F341 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) (in the case of a quoted company) the directors' remuneration report, and

[F342 (d) the auditors' report on those accounts and that directors' report and (in the case of a quoted company) on F343 . . . the auditable part of that directors' remuneration report.]]

(2) If the requirements of paragraph (1) are not complied with before the end of the period allowed for laying and delivering accounts and reports, every person who immediately before the end of that period was a director of the company is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(3) Further, if the directors of the company fail to make good the default within 14 days after the service of a notice on them requiring compliance, the court may on the application of any member or creditor of the company or of the registrar, make an order directing the directors (or any of them) to make good the default within such time as may be specified in the order.

The court's order may provide that all costs of and incidental to the application shall be borne by the directors.

(4) It is a defence for a person charged with an offence under this Article to prove that he took all reasonable steps for securing that the requirements of paragraph (1) would be complied with before the end of the period allowed for laying and delivering accounts and reports.

(5) It is not a defence in any proceedings under this Article to prove that the documents in question were not in fact prepared as required by this Part.]

F337 Arts. 249, 250, 250A, 251, 252 and cross-heading inserted by 1990 NI 5, art. 13

F338 mod. SR 1994/133

F339 prosp. mod. by 2005 NI 17

F340 SR 2005/56

F341 Art. 250(1)(ba) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 8(a)

F342 SR 2005/61

F343 Words in art. 250(1)(d) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 8(b)

[F344 Civil penalty for failure to deliver accounts N.I.

250A .F345 — (1) Where the requirements of Article 250(1) are not complied with before the end of the period allowed for laying and delivering accounts and reports, the company is liable to a civil penalty.

This is in addition to any liability of the directors under Article 250.

(2) The amount of the penalty is determined by reference to the length of the period between the end of the period allowed for laying and delivering accounts and reports and the day on which the requirements are complied with, and whether the company is a public or private company, as follows:—

[F346 Length of period]	[F346 Public company]	[F346 Private company]
[F346 Not more than 3 months.]	[F346 £500]	[F346 £100]
[F346 More than 3 months but not more than 6 months.]	[F346 £1,000]	[F346 £250]
[F346 More than 6 months but not more than 12 months.]	[F346 £2,000]	[F346 £500]
[F346 More than 12 months.]	[F346 £5,000]	[F346 £1,000]

(3) The penalty may be recovered by the registrar and shall be paid by him into the Consolidated Fund.

(4) It is not a defence in proceedings under this Article to prove that the documents in question were not in fact prepared as required by this Part.]

F344 Arts. 249, 250, 250A, 251, 252 and cross-heading inserted by 1990 NI 5, art. 13

F345 mod. SR 1994/133

F346 1990 NI 5

[F347 Delivery and publication of accounts in ECUs N.I.

250B .F348 — (1) The amounts set out in the annual accounts of a company may also be shown in the same accounts translated into ECUs.

(2) When complying with Article 250, the directors of a company may deliver to the registrar an additional copy of the company's annual accounts in which the amounts have been translated into ECUs.

(3) In both cases—

(a) the amounts must have been translated at the relevant exchange rate prevailing on the balance sheet date, and

(b) that rate must be disclosed in the notes to the accounts.

(4) For the purposes of Article 248 any additional copy of the company's annual accounts delivered to the registrar under paragraph (2) shall be treated as statutory accounts of the company and, in the case of such a copy, references in Article 248 to the auditors' report under Article 243 shall be read as references to the auditors' report on the annual accounts of which it is a copy.

(5) In this Article —

• “ECU” means a unit with a value equal to the value of the unit of account known as the ecu used in the European Monetary System, and

• “relevant exchange rate” means the rate of exchange used for translating the value of the ecu for the purposes of that System.]

F347 SR 1992/503

F348 mod. SR 1994/133

Art. 251 rep. by SR 2004/496

[F349 Period allowed for laying and delivering accounts and reports N.I.

252 .F350 — (1) The period allowed for laying and delivering accounts and reports is—

(a) for a private company, 10 months after the end of the relevant accounting reference period, and

(b) for a public company, 7 months after the end of that period.

This is subject to the following provisions of this Article.

(2) If the relevant accounting reference period is the company's first and is a period of more than 12 months, the period allowed is—

(a) 10 months or 7 months, as the case may be, from the first anniversary of the incorporation of the company, or

(b) 3 months from the end of the accounting reference period,

whichever last expires.

Para. (3) rep. by SR 2004/496

(4) If the relevant accounting period is treated as shortened by virtue of a notice given by the company under Article 233 (alteration of accounting reference date), the period allowed for laying and delivering accounts is that applicable in accordance with the above provisions or 3 months from the date of the notice under that Article, whichever last expires.

(5) If for any special reason the Department thinks fit it may, on an application made before the expiry of the period otherwise allowed, by notice in writing to a company extend that period by such further period as may be specified in the notice.

(6) In this Article “the relevant accounting reference period” means the accounting reference period by reference to which the financial year for the accounts in question was determined.]

F349 Arts. 249, 250, 250A, 251, 252 and cross-heading inserted by 1990 NI 5, art. 13

F350 mod. SR 1994/133

Modifications etc. (not altering text)

C5 Art. 252 modified (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(4) (with art. 12)

[F351 Revision of defective accounts and reports]F1029 N.I.

F351 1990 NI 5

Voluntary revision of annual accounts or directors' report N.I.

253 .F352 —(1) If it appears to the directors of a company that any annual accounts [F353 or summary financial statement] of the company, or any directors' report[F354 or F355 . . . ][F356 or directors' remuneration report], did not comply with the requirements of this Order[F353 (or, where applicable, of Article 4 of the IAS Regulation)], they may prepare revised accounts or a[F357 revised statement or report].

(2) Where copies of the previous accounts[F358 or report] have been laid before the company in general meeting or delivered to the registrar, the revisions shall be confined to—

(a) the correction of those respects in which the previous accounts[F358 or report] did not comply with the requirements of this Order[F353 (or, where applicable, of Article 4 of the IAS Regulation)], and

(b) the making of any necessary consequential alterations.

(3) The Department may make provision by regulations as to the application of the provisions of this Order in relation to revised annual accounts[F353 or a revised summary financial statement] or a revised directors' report[F354 or F359 . . . ][F356 or a revised directors' remuneration report].

(4) The regulations may, in particular—

(a) make different provision according to whether the previous accounts[F360 statement or report] are replaced or are supplemented by a document indicating the corrections to be made;

(b) make provision with respect to the functions of the company's auditors[F361 or reporting accountant] in relation to the revised accounts[F362 statement or report];

(c) require the directors to take such steps as may be specified in the regulations where the previous accounts[F363 or report] have been—

(i) sent out to members and others under Article 246(1),

(ii) laid before the company in general meeting, or

(iii) delivered to the registrar,

or where a summary financial statement[F354 containing information [F364 derived from the previous accounts or report]] has been sent to members under Article 259;

(d) apply the provisions of this Order (including those creating criminal offences) subject to such additions, exceptions and modifications as are specified in the regulations.

F352 mod. SR 1994/133

F353 SR 2004/496

F354 SR 2005/61

F355 Words in art. 253(1) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(2)(a)

F356 SR 2005/56

F357 Words in art. 253(1) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(2)(b)

F358 Words in art. 253(2) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(3)

F359 Words in art. 253(3) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(4)

F360 Words in art. 253(4)(a) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(5)

F361 SR 1995/128

F362 Words in art. 253(4)(b) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(5)

F363 Words in art. 253(4)(c) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(6)(a)

F364 Words in art. 253(4)(c) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 9(6)(b)

Department's notice in respect of annual accounts N.I.

253A .F365 — [F366 (1) Where—

(a) copies of a company's annual accounts [F367 or directors' report] have been sent out under Article 246, or

(b) a copy of a company's annual accounts [F368 or directors' report] has been laid before the company in general meeting or delivered to the registrar,

and it appears to the Department that there is, or may be, a question whether the accounts [F369 or report] comply with the requirements of this Order, it may give notice to the directors of the company indicating the respects in which it appears to the Department that such a question arises or may arise.]

(2) The notice shall specify a period of not less than one month for the directors to give the Department an explanation of the accounts[F366 [F370 or report] or prepare revised accounts or [F371 a revised report]].

(3) If at the end of the specified period, or such longer period as it may allow, it appears to the Department that[F366 the directors have not—

(a) given a satisfactory explanation of the accounts [F372 or report] , or

(b) revised the accounts [F372 or report] so as to comply with the requirements of this Order,

it may if it thinks fit apply to the court.]

[F366 (4) The provisions of this Article apply equally to revised annual accounts [F373 and revised directors' reports] , in which case they have effect as if the references to revised accounts [F374 or reports] were references to further revised accounts [F374 or reports] .]

F365 mod. SR 1994/133

F366 SR 2005/61

F367 Words in art. 253A(1)(a) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(2)(a)

F368 Words in art. 253A(1)(b) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(2)(a)

F369 Words in art. 253A(1) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(2)(b)

F370 Words in art. 253A(2) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(3)(a)

F371 Words in art. 253A(2) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(3)(b)

F372 Words in art. 253A(3) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(4)

F373 Words in art. 253A(4) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(5)(a)

F374 Words in art. 253A(4) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 10(5)(b)

Application to court in respect of defective accounts N.I.

253B .F375 —(1) An application may be made to the court—

(a) by the Department, after having complied with Article 253A, or

(b) by a person authorised by the Department for the purposes of this Article,

for a declaration that the annual accounts of a company do not comply[F376 , or a directors' report F377 . . . does not comply,] with the requirements of this Order[F378 (or, where applicable, of Article 4 of the IAS Regulation)] and for an order requiring the directors of the company to prepare revised accounts[F376 or revised report F379 . . . ].

(2) Notice of the application, together with a general statement of the matters at issue in the proceedings, shall be given by the applicant to the registrar for registration.

(3) If the court orders the preparation of revised accounts, it may give directions with respect to—

(a) the auditing of the accounts,

(b) the revision of any directors' report[F380 , directors' remuneration report] or summary financial statement, and

(c) the taking of steps by the directors to bring the making of the order to the notice of persons likely to rely on the previous accounts,

and such other matters as the court thinks fit.

[F376 (3A) If the court orders the preparation of a revised directors' report F381 . . . it may give directions with respect to—

(a) the review of the directors' report F382 . . . by the auditors,

(b) the revision of any directors' report, directors' remuneration report F383 . . . or summary financial statement,

(c) the taking of steps by the directors to bring the making of the order to the notice of persons likely to rely on the previous report F384 . . . , and

(d) such other matters as the court thinks fit.]

(4) If the court finds that the accounts[F385 or report] did not comply with the requirements of this Order[F378 (or, where applicable, of Article 4 of the IAS Regulation)] it may order that all or part of—

(a) the costs of and incidental to the application, and

(b) any reasonable expenses incurred by the company in connection with or in consequence of the preparation of revised accounts[F376 or a revised report F386 . . . ],

shall be borne by such of the directors as were party to the approval of the[F387 defective accounts or report].

For this purpose every director of the company at the time[F376 of the [F388 approval of the accounts or report]] shall be taken to have been a party to[F376 the approval] unless he shows that he took all reasonable steps to prevent[F376 that approval].

(5) Where the court makes an order under paragraph (4) it shall have regard to whether the directors party to the approval of the defective accounts[F389 or report] knew or ought to have known that the accounts[F389 or report] did not comply with the requirements of this Order[F378 (or, where applicable, of Article 4 of the IAS Regulation)], and it may exclude one or more directors from the order or order the payment of different amounts by different directors.

(6) On the conclusion of proceedings on an application under this Article, the applicant shall give to the registrar for registration an office copy of the court order or, as the case may be, notice that the application has failed or been withdrawn.

[F376 (7) The provisions of this Article apply equally to revised annual accounts [F390 and revised directors' reports] , in which case they have effect as if the references to revised accounts [F391 or reports] were references to further revised accounts [F391 or reports] .]

F375 mod. SR 1994/133

F376 SR 2005/61

F377 Words in art. 253B(1) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(2)(a)

F378 SR 2004/496

F379 Words in art. 253B(1) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(2)(b)

F380 SR 2005/56

F381 Words in art. 253B(3A) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(3)(a)

F382 Words in art. 253B(3A)(a) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(3)(b)

F383 Words in art. 253B(3A)(b) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(3)(c)

F384 Words in art. 253B(3A)(c) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(3)(d)

F385 Words in art. 253B(4) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(4)(a)

F386 Words in art. 253B(4)(b) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(4)(b)

F387 Words in art. 253B(4) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(4)(c)

F388 Words in art. 253B(4) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(4)(d)

F389 Words in art. 253B(5) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(5)

F390 Words in art. 253B(7) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(6)(a)

F391 Words in art. 253B(7) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 11(6)(b)

Other persons authorised to apply to court N.I.

253C .F392 —(1) The Department may authorise for the purposes of Article 253B any person appearing to it—

(a) to have an interest in, and to have satisfactory procedures directed to securing, compliance by companies with[F393 the requirements of this Order relating to accounts [F394 and directors' reports]][F395 (or, where applicable, of Article 4 of the IAS Regulation)],

(b) to have satisfactory procedures for receiving and investigating complaints about the[F393 companies' annual accounts [F396 and directors' reports]], and

(c) otherwise to be a fit and proper person to be authorised.

(2) A person may be authorised generally or in respect of particular classes of case, and different persons may be authorised in respect of different classes of case.

(3) The Department may refuse to authorise a person if it considers that its authorisation is unnecessary having regard to the fact that there are one or more other persons who have been or are likely to be authorised.

(4) Authorisation shall be by order made subject to negative resolution.

(5) Where authorisation is revoked, the revoking order may make such provision as the Department thinks fit with respect to pending proceedings.

(6) Neither a person authorised under this Article, nor any officer, servant or member of the governing body of such a person, shall be liable in damages for anything done or purporting to be done for the purposes of or in connection with—

(a) the taking of steps to discover whether there are grounds for an application to the court,

(b) the determination whether or not to make such an application, or

(c) the publication of its reasons for any such decision,

unless the act or omission is shown to have been in bad faith.

F392 mod. SR 1994/133

F393 SR 2005/61

F394 Words in art. 253C(1)(a) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 12(2)

F395 SR 2004/496

F396 Words in art. 253C(1)(b) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 12(2)

Disclosure of information held by Inland Revenue to persons authorised to apply to court N.I.

253D—(1) Information which is held by or on behalf of the Commissioners of Inland Revenue may be disclosed to a person who is authorised under Article 253C, or under section 245C of the Companies Act 1985, if the disclosure—

(a) is made for a permitted purpose, and

(b) is made by the Commissioners or is authorised by them.

(2) Such information—

(a) may be so disclosed despite any other restriction on the disclosure of information whether imposed by any statutory provision or otherwise, but

(b) in the case of personal data (within the meaning of the Data Protection Act 1998), may not be disclosed in contravention of that Act.

(3) For the purposes of paragraph (1), a disclosure is made for a permitted purpose if it is made for the purpose of facilitating—

(a) the taking of steps by the authorised person to discover whether there are grounds for an application to the court under Article 253B or section 245B of the Companies Act 1985; or

(b) a determination by the authorised person as to whether or not to make such an application.

(4) The power of the Commissioners to authorise a disclosure under paragraph (1)(b) may be delegated (either generally or for a specified purpose) to an officer of the Board of Inland Revenue.

Restrictions on use and further disclosure of information disclosed under Article 253D N.I.

253E—(1) Information that is disclosed to an authorised person under Article 253D may not be used except in or in connection with—

(a) taking steps to discover whether there are grounds for an application to the court as mentioned in Article 253D(3)(a);

(b) determining whether or not to make such an application; or

(c) proceedings on any such application.

(2) Information that is disclosed to an authorised person under Article 253D may not be further disclosed except—

(a) to the person to whom the information relates; or

(b) in or in connection with proceedings on any such application to the court.

(3) A person who contravenes paragraph (1) or (2) is guilty of an offence and liable to imprisonment or a fine, or both.

(4) It is a defence for a person charged with an offence under paragraph (3) to prove— <

(a) that he did not know, and had no reason to suspect, that the information had been disclosed under Article 253D; or

(b) that he took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

(5) Articles 680 (restriction on prosecutions), 680A (liability of individuals for corporate default) and 680B (criminal proceedings against unincorporated bodies) apply to offences under this Article.

F397 prosp. insertion by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

[F398 CHAPTER II]F1029 N.I. [F398 Exemptions, exceptions and special provisions]

F398 1990 NI 5

[F399 Small and medium‐sized companies and groups]F1029 N.I.

F399 1990 NI 5

[F400 Special provisions for small companies N.I.

254 .F401 — (1) Subject to Article 255A, this Article applies where a company qualifies as a small company in relation to a financial year.

(2) If the company's individual accounts for the year[F402 are Companies Order individual accounts and]

(a) comply with the provisions of Schedule 8, or

(b) fail to comply with those provisions only in so far as they comply instead with one or more corresponding provisions of Schedule 4,

they need not comply with the provisions or, as the case may be, the remaining provisions of Schedule 4; and where advantage is taken of this paragraph, references in[F402 Article 234A] to compliance with the provisions of Schedule 4 shall be construed accordingly.

[F403 (3) The company's individual accounts for the year—

(a) may give the total of the aggregates required by heads (a), (c) and (d) of paragraph 1(1) of Schedule 6 (emoluments and other benefits etc. of directors) instead of giving those aggregates individually; and

(b) need not give the information required by—

[F404 (ai) Article 239A (disclosure required in notes to annual accounts: particulars of staff);]

(i) paragraph 4 of Schedule 5 (financial years of subsidiary undertakings);

(ii) paragraph 1(2)(b) of Schedule 6 (numbers of directors exercising share options and receiving shares under long term incentive schemes);

(iii) paragraph 2 of Schedule 6 (details of highest paid director's emoluments etc.); or

(iv) paragraph 7 of Schedule 6 (excess retirement benefits of directors and past directors).]

(4) The directors' report for the year need not give the information required by—

[F405 (a) Articles 242ZZA(1)(c) (directors' report: amount to be paid as dividend) F406 . . . ;]

(b) paragraph 1(2) of Schedule 7 (statement of market value of fixed assets where substantially different from balance sheet amount);

[F402 (ba) paragraph 5A of Schedule 7 (disclosures relating to the use of financial instruments);]

(c) paragraph 6 of Schedule 7 (miscellaneous disclosures); or

(d) paragraph 11 of Schedule 7 (employee involvement).

(5) Notwithstanding anything in Article 250(1), the directors of the company need not deliver to the registrar any of the following, namely—

(a) a copy of the company's profit and loss account for the year;

(b) a copy of the directors' report for the year; and

(c) if[F402 they prepare Companies Order individual accounts and] they deliver a copy of a balance sheet drawn up as at the last day of the year which complies with the requirements of Schedule 8A, a copy of the company's balance sheet drawn up as at that day.

(6) Neither a copy of the company's accounts for the year delivered to the registrar under Article 250(1), nor a copy of a balance sheet delivered to the registrar under paragraph (5)(c), need give the information required by—

(a) paragraph 4 of Schedule 5 (financial years of subsidiary undertakings);

(b) paragraph 6 of Schedule 5 (shares of company held by subsidiary undertakings);

(c) Part I of Schedule 6 (directors' and chairman's emoluments, pensions and compensation for loss of office); or

(d) Article 398A(3) (amount of auditors' remuneration).

(7) The provisions of Article 241 as to the signing of the copy of the balance sheet delivered to the registrar apply to a copy of a balance sheet delivered under paragraph (5)(c).

(8) Subject to paragraph (9), each of the following, namely—

(a) accounts prepared in accordance with paragraph (2) or (3),

(b) a report prepared in accordance with paragraph (4), and

(c) a copy of accounts delivered to the registrar in accordance with paragraph (5) or (6),

shall contain a statement in a prominent position on the balance sheet, in the report or, as the case may be, on the copy of the balance sheet, above the signature required by Article 241, 242A or paragraph (7), that they are prepared in accordance with the special provisions of this Part relating to small companies.

(9) Paragraph (8) does not apply where[F407 the directors of the company have taken advantage of the exemption from audit conferred by Article 257AA (dormant companies)].]

F400 SR 1997/436, reg. 2

F401 mod. SR 1994/133

F402 SR 2004/496

F403 SR 1997/545

F404 Art. 254(3)(b)(ai) inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 12

F405 SR 2005/61

F406 Words in art. 254(4)(a) repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 43(2))

F407 SR 2001/153

[F408 Special provisions for medium‐sized companies N.I.

254A .F409 — [F410 (1) Subject to Article 255A, this Article applies where a company qualifies as a medium‐sized company in relation to a financial year[F411 and its directors prepare Companies Order individual accounts for that year].

(2) The company's individual accounts for the year need not comply with the requirements of paragraph 36A of Schedule 4 (disclosure with respect to compliance with accounting standards).

[F412 (2A) The directors' report for the year need not comply with the requirements of Article 242ZZB(3) (business review to include analysis using key performance indicators) so far as they relate to non-financial information.]

(3) The company may deliver to the registrar a copy of the company's accounts for the year—

(a) which includes a profit and loss account in which the following items listed in the profit and loss account formats set out in Part I of Schedule 4 are combined as one item under the heading “gross profit or loss”

• Items 1, 2, 3 and 6 in Format 1;

• Items 1 to 5 in Format 2;

• Items A.1, B.1 and B.2 in Format 3;

• Items A.1, A.2 and B.1 to B.4 in Format 4;

(b) which does not contain the information required by paragraph 55 of Schedule 4 (particulars of turnover).

(4) A copy of accounts delivered to the registrar in accordance with paragraph (3) shall contain a statement in a prominent position on the copy of the balance sheet, above the signature required by Article 241, that the accounts are prepared in accordance with the special provisions of this Part relating to medium‐sized companies.]]

F408 SR 1997/436

F409 mod. SR 1994/133

F410 Art. 254A repealed (1.10.2007 for art. 254A(2A), otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

F411 SR 2004/496

F412 SR 2005/61

Qualification of company as small or medium‐sized N.I.

255 .F413 —(1) A company qualifies as small or medium‐sized in relation to a financial year if the qualifying conditions are met—

(a) in the case of the company's first financial year, in that year, and

(b) in the case of any subsequent financial year, in that year and the preceding year.

(2) A company shall be treated as qualifying as small or medium‐sized in relation to a financial year—

(a) if it so qualified in relation to the previous financial year under[F414 paragraph (1) or was treated as so qualifying under sub‐paragraph (b)]; or

(b) if it was treated as so qualifying in relation to the previous year by virtue of sub‐paragraph (a) and the qualifying conditions are met in the year in question.

(3) The qualifying conditions are met by a company in a year in which it satisfies two or more of the following requirements—

[F415 Small company]

[F415 1. Turnover]	[F416 Not more than £5.6 million]
[F415 2. Balance sheet total]	[F416 Not more than £2.8 million]
[F415 3. Number of employees]	[F415 Not more than 50]

[F415 Medium‐sized company]

[F415 1. Turnover]	[F416 Not more than £22.8 million]
[F415 2. Balance sheet total]	[F416 Not more than £11.4 million]
[F415 3. Number of employees]	[F415 Not more than 250.]

(4) For a period which is a company's financial year but not in fact a year the maximum figures for turnover shall be proportionately adjusted.

[F417 (5) The balance sheet total means—

(a) in the case of Companies Order individual accounts—

(i) the aggregate of the amounts shown in the balance sheet under the headings corresponding to items A to D of Format 1 in Part I of Schedule 4 or Part I of Schedule 8, or

(ii) if Format 2 is adopted, the aggregate of the amounts shown under the general heading “ASSETS”;

(b) in the case of IAS individual accounts, the aggregate of the amounts shown as assets in the balance sheet.]

(6) The number of employees means the average number of persons employed by the company in the year (determined on a[F418 monthly] basis).

That number shall be determined by applying the method of calculation prescribed by paragraph 56(2) and (3) of Schedule 4 for determining the corresponding number required to be stated in a note to the company's accounts.

F413 mod. SR 1994/133

F414 SR 1992/503

F415 1990 NI 5

F416 SR 2004/190

F417 SR 2004/496

F418 SR 1997/314

[F419 Cases in which special provisions do not apply N.I.

255A .F420 — [F421 (1) If a company is, or was at any time within the financial year to which the accounts relate, an ineligible company, Articles 254 and 254A do not apply.

(1A) If a company does not fall within paragraph (1) but is, or was at any time within the financial year to which the accounts relate, a member of an ineligible group—

(a) Article 254(4) and (5)(b) and Article 254(2A) apply;

(b) the other provisions of Articles 254 and 254A do not apply.

[F422 (1B) A company that qualifies as small in relation to the financial year to which the accounts relate is ineligible if—

(a) it is a public company,

(b) it is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company, or

(c) it carries on an insurance market activity.

(1C) A company that qualifies as medium-sized in relation to the financial year to which the accounts relate is ineligible if—

(a) it is a public company,

(b) it has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity, or

(c) it carries on an insurance market activity.]]

(2) A group is ineligible if any of its members is—

(a) a public company or a body corporate which (not being a company) has power under its constitution to offer its shares or debentures to the public and may lawfully exercise that power,

[F423 (b) a person [F424 (other than a small company)] who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity,

[F425 (ba) a small company that is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company, or]

(c) a person who carries on insurance market activity.]

[F426 (2A) A company is a small company for the purposes of paragraph (2) if it qualified as small in relation to its last financial year ending on or before the end of the financial year to which the accounts relate.]

(3) A parent company shall not be treated as qualifying as a small company in relation to a financial year unless the group headed by it qualifies as a small group, and shall not be treated as qualifying as a medium-sized company in relation to a financial year unless that group qualifies as a medium-sized group (see Article 257).]

F419 SR 1997/436, reg. 4

F420 mod. SR 1994/133

F421 SR 2005/61

F422 Art. 255A(1B)(1C) substituted (1.12.2006) for art. 255A(1B) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 2(2)

F423 SI 2001/3649

F424 Words in art. 255A(2)(b) inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 2(3)(a)

F425 Art. 255A(2)(ba) substituted (1.12.2006) for word in art. 255A(2)(b) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 2(3)(b)

F426 Art. 255A(2A) inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 2(4)

[F427 Special auditors' report N.I.

255B .F428 — (1) This Article applies where—

(a) the directors of a company propose to deliver to the registrar copies of accounts ("abbreviated accounts") prepared in accordance with Article 254(5) or (6) or 254A(3) ("the relevant provision"),

(b) the directors have not taken advantage of the exemption from audit conferred by Article 257A(1) or (2)[F429 or Article 257AA],F429 . . .

Sub.‐para. (c) rep. by SR 2001/153

(2) If abbreviated accounts prepared in accordance with the relevant provision are delivered to the registrar, they shall be accompanied by a copy of a special report of the auditors stating that in their opinion—

(a) the company is entitled to deliver abbreviated accounts prepared in accordance with that provision, and

(b) the abbreviated accounts to be delivered are properly prepared in accordance with that provision.

(3) In such a case a copy of the auditors' report under Article 243 need not be delivered, but—

(a) if that report was qualified, the special report shall set out that report in full together with any further material necessary to understand the qualification; and

(b) if that report contained a statement under—

(i) Article 245(2) (accounts, records or returns inadequate or accounts not agreeing with records and returns), or

(ii) Article 245(3) (failure to obtain necessary information and explanations),

the special report shall set out that statement in full.

(4) Article 244 (signature of auditors' report) applies to a special report under this Article as it applies to a report under Article 243.

(5) If abbreviated accounts prepared in accordance with the relevant provision are delivered to the registrar, references in Article 248 (requirements in connection with publication of accounts) to the auditors' report under Article 243 shall be read as references to the special auditors' report under this Article.]

F427 SR 1997/436, reg. 5

F428 mod. SR 1994/133

F429 SR 2001/153

Exemption for small and medium‐sized groups N.I.

256 .F430 —(1) A parent company need not prepare group accounts for a financial year in relation to which the group headed by that company qualifies as a small or medium‐sized group and is not an ineligible group.

(2) A group is ineligible if any of its members is—

(a) a public company or a body corporate which (not being a company) has power under its constitution to offer its shares or debentures to the public and may lawfully exercise that power,

[F431 (b) a person [F432 (other than a small company)] who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity,

[F433 (ba) a small company that is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company, or]

(c) a person who carries on insurance market activity.]

[F434 (2A) A company is a small company for the purposes of paragraph (2) if it qualified as small in relation to its last financial year ending on or before the end of the financial year to which the group accounts relate.]

Paras. (3), (4) rep. by SR 1997/314

F430 mod. SR 1994/133

F431 SI 2001/3649

F432 Words in art. 256(2)(b) inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 3(2)(a)

F433 Art. 256(2)(ba) substituted (1.12.2006) for word in art. 256(2)(b) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 3(2)(b)

F434 Art. 256(2A) inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 3(3)

[F435 Group accounts prepared by small company N.I.

256A .F436 — (1) This Article applies where a small company—

(a) has prepared individual accounts for a financial year in accordance with Article 254(2) or (3), and

(b) is preparing[F437 Companies Order group accounts] in respect of the same year.

(2) If the group accounts—

(a) comply with the provisions of Schedule 8, or

(b) fail to comply with those provisions only in so far as they comply instead with one or more corresponding provisions of Schedule 4,

they need not comply with the provisions or, as the case may be, the remaining provisions of Schedule 4; and where advantage is taken of this paragraph, references in Schedule 4A to compliance with the provisions of Schedule 4 shall be construed accordingly.

(3) For the purposes of this Article, Schedule 8 shall have effect as if, in each balance sheet format set out in that Schedule, for item B.III there were substituted the following item—

“B.III Investments

1. Shares in group undertakings

2. Interests in associated undertakings

3. Other participating interests

4. Loans to group undertakings and undertakings in which a participating interest is held

5. Other investments other than loans

6. Others.”

(4) The group accounts need not give the information required by the provisions specified in Article 254(3).

(5) Group accounts prepared in accordance with this Article shall contain a statement in a prominent position on the balance sheet, above the signature required by Article 241, that they are prepared in accordance with the special provision of this Part relating to small companies.]

F435 SR 1997/436, reg. 6

F436 mod. SR 1994/133

F437 SR 2004/496

Qualification of group as small or medium‐sized N.I.

257 .F438 —(1) A group qualifies as small or medium‐sized in relation to a financial year if the qualifying conditions are met—

(a) in the case of the parent company's first financial year, in that year, and

(b) in the case of any subsequent financial year, in that year and the preceding year.

(2) A group shall be treated as qualifying as small or medium‐sized in relation to a financial year—

(a) if it so qualified in relation to the previous financial year under[F439 paragraph (1) or was treated as so qualifying under sub‐paragraph (b)]; or

(b) if it was treated as so qualifying in relation to the previous year by virtue of sub‐paragraph (a) and the qualifying conditions are met in the year in question.

(3) The qualifying conditions are met by a group in a year in which it satisfies two or more of the following requirements—

[F440 Small group]

[F440 1. Aggregate turnover]	[F441 Not more than £5.6 million net (or £6.72 million gross)]
[F440 2. Aggregate balance sheet total]	[F441 Not more than £2.8 million net (or £3.36 million gross)]
[F440 3. Aggregate number of employees]	[F440 Not more than 50]

[F440 Medium‐sized group]

[F440 1. Aggregate turnover]	[F441 Not more than £22.8 million net (or £27.36 million gross)]
[F440 2. Aggregate balance sheet total]	[F441 Not more than £11.4 million net (or £13.68 million gross)]
[F440 3. Aggregate number of employees]	[F440 Not more than 250]

(4) The aggregate figures shall be ascertained by aggregating the relevant figures determined in accordance with Article 255 for each member of the group.

In relation to the aggregate figures for turnover and balance sheet total, “net” means with the set‐offs and other adjustments required by Schedule 4A in the case of group accounts and “gross” means without those set‐offs and other adjustments; and a company may satisfy the relevant requirement on the basis of either the net or the gross figure.

(5) The figures for each subsidiary undertaking shall be those included in its accounts for the relevant financial year, that is—

(a) if its financial year ends with that of the parent company, that financial year, and

(b) if not, its financial year ending last before the end of the financial year of the parent company.

(6) If those figures cannot be obtained without disproportionate expense or undue delay, the latest available figures shall be taken.

F438 mod. SR 1994/133

F439 SR 1992/503

F440 1990 NI 5

F441 SR 2004/190

[F442 Exemptions from audit for certain categories of small company]F1029 N.I.

F442 SR 1995/128

Exemptions from audit N.I.

257A .F443 —(1) Subject to Article 257B, a company which meets the total exemption conditions set out below in respect of a financial year is exempt from the provisions of this Part relating to the audit of accounts in respect of that year.

(2) Subject to Article 257B,[F444 a company which is a charity and] which meets the report conditions set out below in respect of a financial year is exempt from the provisions of this Part relating to the audit of accounts in respect of that year if the directors cause a report in respect of the company's individual accounts for that year to be prepared in accordance with Article 257C and made to the company's members.

(3) The total exemption conditions are met by a company in respect of a financial year if—

(a) it qualifies as a small company in relation to that year for the purposes of Article 254,

(b) its turnover in that year is not more than[F445 £5.6 million], and

(c) its balance sheet total for that year is not more than[F445 £2.8 million].

[F444 (3A) In relation to any company which is a charity, paragraph (3)(b) shall have effect with the substitution—

(a) for the reference to turnover of a reference to gross income, and

(b) for the reference to[F445 £5.6 million] of a reference to £90,000.]

(4) The report conditions are met by[F444 a company which is a charity] in respect of a financial year if—

(a) it qualifies as a small company in relation to that year for the purposes of Article 254,

(b) its[F444 gross income] in that year is more than £90,000 but not more than[F444 £250,000], and

(c) its balance sheet total for that year is not more than £1.4 million.

Para. (5) rep. by SR 1997/500

(6) For a period which is a company's financial year but not in fact a year the maximum figures for turnover or gross income shall be proportionately adjusted.

[F444 (6A) A company is entitled to the exemption conferred by paragraph (1) or (2) notwithstanding that it falls within sub-paragraph (a) or (b) of[F446 Article 257AA(1)].]

(7) In this Article—

• “balance sheet total” has the meaning given by Article 255(5), and

• “gross income” means the company's income from all sources, as shown in the company's income and expenditure account.

F443 mod. SR 1994/133

F444 SR 1997/500

F445 SR 2004/190

F446 SR 2001/153

[F447 Dormant Companies N.I.

257AA.— (1) Subject to Article 257B(2) to (5), a company is exempt from the provisions of this Part relating to the audit of accounts in respect of a financial year if—

(a) it has been dormant since its formation, or

(b) it has been dormant since the end of the previous financial year and paragraph (2) applies.

(2) This paragraph applies if the company—

(a) is entitled in respect of its individual accounts for the financial year in question to prepare accounts in accordance with Article 254, or would be so entitled but for the application [F448 to it of paragraph (1A), (1B)(a) or (1C)(a) of Article 255A] , and

(b) is not required to prepare group accounts for that year.

(3) Paragraph (1) does not apply if at any time in the financial year in question the company was—

[F449 [F450 (a) an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company;]

(b) a person who carries on insurance market activity.]

(4) A company is "dormant" during any period in which it has no significant accounting transaction.

(5) “Significant accounting transaction” means a transaction which—

(a) is required by Article 229 to be entered in the company's accounting records; but

(b) is not a transaction to which paragraph (6) or (7) applies.

(6) This paragraph applies to a transaction arising from the taking of shares in the company by a subscriber to the memorandum as a result of an undertaking of his in the memorandum.

(7) This paragraph applies to a transaction consisting of the payment of—

(a) a fee to the registrar on a change of name under Article 38 (change of name),

(b) a fee to the registrar on the re-registration of a company under Part III (re-registration as a means of altering a company's status),

(c) a penalty under Article 250A (penalty for failure to deliver accounts), or

(d) a fee to the registrar for the registration of an annual return under Chapter III of Part XII.]

F447 SR 2001/153

F448 Words in art. 257AA(2)(a) substituted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 4(2)

F449 SI 2001/3649

F450 Art. 257AA(3)(a) substituted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 4(3)

Cases where exemptions not available N.I.

257B .F451 —(1)  [F452 Subject to[F453 paragraphs (1A) to (1C)],] a company is not entitled to the exemption conferred by paragraph (1) or (2) of Article 257A in respect of a financial year if at any time within that year—

(a) it was a public company,

[F454 (b) it was an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company,]

[F455 (bb) it carried on an insurance market activity,]

Sub‐para. (c) rep. by SI 2001/1283

(d) F456 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(e) it was an employers' association as defined in Article 4 of the Industrial Relations (Northern Ireland) Order 1992,

(f) it was a parent company or a subsidiary undertaking.

[F452 (1A) A company which, apart from this paragraph, would fall within paragraph (1)(f) by virtue of its being a subsidiary undertaking for any period within a financial year shall not be treated as so falling if it is dormant (within the meaning of[F457 Article 257AA]) throughout that period.]

[F453 (1B) A company which, apart from this paragraph, would fall within paragraph (1)(f) by virtue of its being a parent company or a subsidiary undertaking for any period within a financial year, shall not be treated as so falling if throughout that period it was a member of a group meeting the conditions set out in paragraph (1C).

(1C) The conditions referred to in paragraph (1B) are—

(a) that the group qualifies as a small group, in relation to the financial year within which the period falls, for the purposes of Article 257[F457 (or if all bodies corporate in such group were companies, would so qualify)] and is not, and was not at any time within that year, an ineligible group within the meaning of Article 256(2).

(b) that the group's aggregate turnover in that year (calculated in accordance with Article 257) is[F457 , where the company referred to in paragraph (1B) is a charity,] not more than £350,000 net (or £420,000 gross)[F457 or,where the company so referred to is not a charity,[F458 not more than £5.6 million net (or £6.72 million gross)]], and

(c) that the group's aggregate balance sheet total for that year (calculated in accordance with Article 257) is[F458 not more than £2.8 million net (or £3.36 million gross)].]

(2) Any member or members holding not less in the aggregate than 10 per cent in nominal value of the company's issued share capital or any class of it or, if the company does not have a share capital, not less than 10 per cent in number of the members of the company, may, by notice in writing deposited at the registered office of the company during a financial year but not later than one month before the end of that year, require the company to obtain an audit of its accounts for that year.

(3) Where a notice has been deposited under paragraph (2), the company is not entitled to the exemption conferred by paragraph (1) or (2) of Article 257A[F457 or by paragraph (1) of Article 257AA] in respect of the financial year to which the notice relates.

(4) A company is not entitled to the exemption conferred by paragraph (1) or (2) of Article 257A[F457 or by paragraph (1) of Article 257AA] unless its balance sheet contains a statement by the directors—

(a) [F452 to the effect] that for the year in question the company was entitled to exemption under paragraph (1) or (2)F457 . . . of Article 257A[F457 or paragraph (1) of Article 257AA],

[F457 (b) to the effect that members have not required the company to obtain an audit of its accounts for the year in question in accordance with paragraph (2), and]

(c) [F452 to the effect] that the directors acknowledge their responsibilities for—

(i) ensuring that the company keeps accounting records which comply with Article 229, and

(ii) preparing accounts which give a true and fair view of the state of affairs of the company as at the end of the financial year and of its profit or loss for the financial year in accordance with the requirements of Article 234, and which otherwise comply with the requirements of this Order relating to accounts, so far as applicable to the company.

(5) The statement required by paragraph (4) shall appear in the balance sheet[F452 above the signature required by Article 241].

F451 mod. SR 1994/133

F452 SR 1997/314

F453 SR 1997/500

F454 Art. 257B(1)(b) substituted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 5(2)

F455 SI 2001/3649

F456 Art. 257B(1)(d) omitted (1.12.2006) by virtue of Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 5(3)

F457 SR 2001/153

F458 SR 2004/190

The report required for the purposes of Article 257A(2) N.I.

257C .F459 —(1) The report required for the purposes of Article 257A(2) shall be prepared by a person (referred to in this Part as “the reporting accountant”) who is eligible under Article 257D.

(2) The report shall state whether in the opinion of the reporting accountant making it—

(a) the accounts of the company for the financial year in question are in agreement with the accounting records kept by the company under Article 229, and

(b) having regard only to, and on the basis of, the information contained in those accounting records, those accounts have been drawn up in a manner consistent with the provisions of this Order specified in paragraph (6), so far as applicable to the company.

(3) The report shall also state that in the opinion of the reporting accountant, having regard only to, and on the basis of, the information contained in the accounting records kept by the company under Article 229, the company satisfied the requirements of paragraph (4) of Article 257AF460 . . . for the financial year in question, and did not fall within Article 257B(1)(a) to (f) at any time within that financial year.

(4) The report shall state the name of the reporting accountant and be signed by him.

(5) Where the reporting accountant is a body corporate or partnership, any reference to signature of the report, or any copy of the report, by the reporting accountant is a reference to signature in the name of the body corporate or partnership by a person authorised to sign on its behalf.

(6) The provisions referred to in paragraph (2)(b) are—

(a) [F461 Article 234A(3)] and Schedule 4,

(b) Article 239 and paragraphs 7 to 9A and 13(1), (3) and (4) of Schedule 5, and

(c) Article 240 and Schedule 6,

where appropriate as modified by[F462 Article 254(2) and (3)].

F459 mod. SR 1994/133

F460 SR 2001/153

F461 SR 2004/496

F462 SR 1997/436

The reporting accountant N.I.

257D .F463 —(1) The reporting accountant shall be either—

(a) any member of a body listed in paragraph (4) who, under the rules of the body—

(i) is entitled to engage in public practice, and

(ii) is not ineligible for appointment as a reporting accountant, or

(b) any person (whether or not a member of any such body) who—

(i) is subject to the rules of any such body in seeking appointment or acting as auditor under Chapter V of Part XII, and

(ii) under those rules, is eligible for appointment as auditor under that Chapter.

(2) In paragraph (1), references to the rules of a body listed in paragraph (4) are to the rules (whether or not laid down by the body itself) which the body has power to enforce and which are relevant for the purposes of Part III of the Companies (Northern Ireland) Order 1990 or this Article.

This includes rules relating to the admission and expulsion of members of the body, so far as relevant for the purposes of that Part or this Article.

(3) An individual, a body corporate or a partnership may be appointed as a reporting accountant, and Article 29 of the Companies (Northern Ireland) Order 1990 (effect of appointment of partnership) shall apply to the appointment as reporting accountant of a partnership constituted under the law of England and Wales or Northern Ireland, or under the law of any other country or territory in which a partnership is not a legal person.

(4) The bodies referred to in paragraphs (1) and (2) are—

(a) the Institute of Chartered Accountants in England and Wales,

(b) the Institute of Chartered Accountants of Scotland,

(c) the Institute of Chartered Accountants in Ireland,

(d) [F464 the Association of Chartered Certified Accountants,]F465 . . .

(e) the Association of Authorised Public Accountants[F465 ,and]

[F465 (f) the Institute of Chartered Secretaries and Administrators.]

.

(5) A person is ineligible for appointment by a company as a reporting accountant if he would be ineligible for appointment as an auditor of that company under Article 30 of the Companies (Northern Ireland) Order 1990 (ineligibility on ground of lack of independence).

F463 mod. SR 1994/133

F464 SR 1997/500

F465 SR 2004/190

Effect of exemptions N.I.

257E .F466 —(1) Where the directors of a company have taken advantage of the exemption conferred by Article 257A(1) [F467 or 257AA(1)]

(a) Articles 246 and 247 (right to receive or demand copies of accounts and reports) shall have effect with the omission of references to the auditors' report;

(b) no copy of an auditors' report need be delivered to the registrar or laid before the company in general meeting;

(c) paragraphs (3) to (5) of Article 279 (accounts by reference to which distribution to be justified) shall not apply.

[F467 (1A) Where the directors of a company have taken advantage of the exemption conferred by Article 257AA, then for the purposes of that Article the company shall be treated as a company entitled to prepare accounts in accordance with Article 254 even though it is a member of an ineligible group.]

(2) Where the directors of a company have taken advantage of the exemption conferred by Article 257A(2)—

(a) paragraphs (2) to (4) of Article 244 (which require copies of the auditors' report to state the names of the auditors) shall have effect with the substitution for references to the auditors and the auditors' report of references to the reporting accountant and the report made for the purposes of Article 257A(2) respectively;

(b) Articles 246 and 247 (right to receive or demand copies of accounts and reports), Article 249 (accounts and reports to be laid before company in general meeting) and Article 250 (accounts and reports to be delivered to the registrar) shall have effect with the substitution for references to the auditors' report of references to the report made for the purposes of Article 257A(2);

(c) paragraphs (3) to (5) of Article 279 (accounts by reference to which distribution to be justified) shall not apply;

(d) F468 Article 397A(1) and (2) (rights to information) shall have effect with the substitution for references toF468 the auditors of references to the reporting accountant.

F466 mod. SR 1994/133

F467 SR 2001/153

F468 prosp. subst. by 2005 NI 17

Art. 258 rep. by SR 2001/153

[F469 Listed public companies]F1029 N.I.

F469 1990 NI 5

[F470 Summary financial statement] N.I.

259 .F471 — [F472 (1) [F470 A company] need not, in such cases as may be specified by regulations made by the Department, and provided any conditions so specified are complied with, send copies of the documents referred to in[F473 Article 246(1A)] to[F474 entitled persons], but may instead send them a summary financial statement.

• [F474 In this Article—

• “entitled person”, in relation to a company, means such of the persons specified in Article 246(1)(a) to (c) as are or would apart from this Article be entitled to be sent copies of those documents relating to the company which are referred to in that paragraph;

• [F473 “summary financial statement” means a statement that is derived from the company's annual accounts and (in the case of a quoted company) the directors' remuneration report and prepared in accordance with this Article and regulations made under it;]]

• Definitions rep. by SR 2004/496

(2) Copies of the documents referred to in[F473 Article 246(1A)] shall, however, be sent to[F474 any entitled person] who wishes to receive them; and the Department may by regulations make provision as to the manner in which it is to be ascertained[F474 (whether before or after he becomes an entitled person)] whether[F474 an entitled person] wishes to receive them.

(2ZA) F475 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F476 (2A) References in this Article to sending a summary financial statement to an entitled person include references to using electronic communications for sending the statement to such address as may for the time being be notified to the company by that person for that purpose.

(2B) For the purposes of this Article a summary financial statement is also to be treated as sent to an entitled person where—

(a) the company and that person have agreed to his having access to summary financial statements on a web site (instead of their being sent to him);

(b) the statement is a statement to which that agreement applies; and

(c) that person is notified, in a manner for the time being agreed for the purpose between him and the company, of—

(i) the publication of the statement on a web site;

(ii) the address of that web site; and

(iii) the place on that web site where the statement may be accessed, and how it may be accessed.

(2C) For the purposes of this Article a statement treated in accordance with paragraph (2B) as sent to an entitled person is to be treated as sent to him if, and only if—

(a) the statement is published on the web site throughout a period beginning at least 21 days before the date of the meeting at which the accounts and[F473 directors' remuneration report] from which the statement is derived are to be laid and ending with the conclusion of that meeting; and

(b) the notification given for the purposes of sub-paragraph (c) of that paragraph is given not less than 21 days before the date of the meeting.

(2D) Nothing in[F473 paragraph F477 . . . (2C)] shall invalidate the proceedings of a meeting where—

[F473 (a) any F478 . . . statement that is required to be published on a web site as mentioned in those paragraphs is published for a part, but not all, of the period mentioned in those paragraphs; and]

(b) the failure to publish thatF479 . . . statement throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the company to prevent or avoid.

(2E) A company may, notwithstanding any provision to the contrary in its articles, take advantage of any of paragraphs (2A) to (2D).]

[F473 (3) The summary financial statement must—

(a) be in such form, and

(b) contain such information,

as the Department may by regulations specify, including information derived from the company's directors' report F480 . . . .

(3A) Nothing in this Article or regulations made under it prevents a company from including in its summary financial statement additional information derived from the company's annual accounts, directors' remuneration report [F481 or directors' report] .]

[F482 (4) Every summary financial statement shall—

(a) state that it is only a summary of information in the company's annual accountsF473 . . . and (in the case of a quoted company) the directors' remuneration report;

[F473 (aa) state whether it contains additional information derived from the directors' report F483 . . . and, if so, state that it does not contain the full text of that report F484 . . . ;

(ab) state how an entitled person can obtain a full copy of the documents referred to in Article 246(1A);

(ac) F485 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

(b) contain a statement by the company's auditors of their opinion as to whether the summary financial statement

[F473 (i) is consistent with the company's annual accounts and directors' remuneration report and (where information derived from the directors' report F486 . . . is included in the statement) with that report F487 . . . , and

(ii) complies with the requirements of this Article and regulations made under it;]

(c) state whether the auditors' report on the annual accounts, or on the annual accounts and the auditable part of the directors' remuneration report, was unqualified or qualified, and if it was qualified set out the report in full together with any further material needed to understand the qualification;

[F488 (ca) state whether, in that report, the auditor's statement under Article 243(3). (whether directors' report is consistent with accounts) was qualified or unqualified and, if qualified, set out the qualified statement in full together with any further material needed to understand the qualification;]

(d) state whether that auditors' report contained a statement under—

(i) Article 245(2); or

(ii) Article 245(3),

and if so, set out the statement in full.]

(5) If default is made in complying with this Article or regulations made under it, the company and every officer of it who is in default is guilty of an offence and liable to a fine.

(6) Article 248 (requirements in connection with publication of accounts) does not apply in relation to the provision to[F474 entitled persons] of a summary financial statement in accordance with this Article.]

F470 SR 2004/496

F471 mod. SR 1994/133

F472 Art. 259 repealed (20.1.2007 for art. 259(2A)-(2E) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

F473 SR 2005/61

F474 SR 1993/220

F475 Art. 259(2ZA) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(2)

F476 SR 2003/3

F477 Words in art. 259(2D) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(3)(a)

F478 Words in art. 259(2D)(a) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(3)(b)

F479 Words in art. 259(2D)(b) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(3)(b)

F480 Words in art. 259(3) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(4)

F481 Words in art. 259(3A) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(5)

F482 SR 2005/56

F483 Words in art. 259(4)(aa) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(6)(a)(i)

F484 Words in art. 259(4)(aa) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(6)(a)(ii)

F485 Art. 259(4)(ac) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(6)(b)

F486 Words in art. 259(4)(b)(i) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(6)(c)(i)

F487 Words in art. 259(4)(b)(i) omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(6)(c)(ii)

F488 Art. 259(4)(ca) substituted (31.3.2006) by Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 13(6)(d)

Private companiesF1029 N.I.

Election to dispense with laying of accounts and reports before general meeting N.I.

260.  F489 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F489 Art. 260 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 49)

Right of shareholder to require laying of accounts N.I.

261.  F490 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F490 Art. 261 repealed (20.1.2007 for art. 261(2A) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Unlimited companiesF1029 N.I.

Exemption from requirement to deliver accounts and reports N.I.

262 .F491 —(1) The directors of an unlimited company are not required to deliver accounts and reports to the registrar in respect of a financial year if the following conditions are met.

(2) The conditions are that at no time during the relevant accounting reference period—

(a) has the company been, to its knowledge, a subsidiary undertaking of an undertaking which was then limited, or

(b) have there been, to its knowledge, exercisable by or on behalf of two or more undertakings which were then limited, rights which if exercisable by one of them would have made the company a subsidiary undertaking of it, or

(c) has the company been a parent company of an undertaking which was then limited.

The references above to an undertaking being limited at a particular time are to an undertaking (under whatever law established) the liability of whose members is at that time limited.

(3) The exemption conferred by this Article does not apply[F492 if—]

[F492 (a) the company is a banking[F493 or insurance] company or the parent company of a banking[F493 or insurance] group, or

(b) the company is a qualifying company within the meaning of the Partnerships and Unlimited Companies (Accounts) Regulations (Northern Ireland) 1994,F494 . . . ]

Sub‐para. (c) rep. by 2005 NI 7

(4) Where a company is exempt by virtue of this Article from the obligation to deliver accounts, Article 248 (requirements in connection with publication of accounts) has effect with the following modifications—

(a) in paragraph (3)(b) for the words from “whether statutory accounts” to “have been delivered to the registrar” substitute “ that the company is exempt from the requirement to deliver statutory accounts ”, and

(b) in paragraph (5) for “as required to be delivered to the registrar under Article 250” substitute “ as prepared in accordance with this Part and approved by the board of directors ”.

F491 mod. SR 1994/133

F492 SR 1994/133

F493 SR 1994/428

F494 2005 NI 7

[F495 Banking and insurance companies and groups]F1029 N.I.

F495 SR 1992/258

Special provisions for banking and insurance companies N.I.

263 .F496 —(1) A banking company shall prepare its individual accounts in accordance with Part I of Schedule 9 rather than Schedule 4.

(2) An insurance company[F497 shall] prepare its individual accounts in accordance with Part I of Schedule 9A rather than Schedule 4.

(3) Accounts so prepared shall contain a statement that they are prepared in accordance with the special provisions of this Part relating to banking companies or to insurance companies, as the case may be.

(4) In relation to the preparation of individual accounts in accordance with the special provisions of this Part, the references to Schedule 4 in Article 234(4) and (5) (relationship between specific requirements and duty to give true and fair view) shall be read as references to the provisions of Part I of Schedule 9, in the case of the accounts of banking companies, or to the provisions of Part I of Schedule 9A, in the case of the accounts of insurance companies.

[F498 (4A) References to Companies Order individual accounts include accounts prepared in accordance with this Article.

(4B) This Article does not apply to banking companies and insurance companies that prepare IAS individual accounts.]

Para. (5) rep. by SR 1994/428

F496 mod. SR 1994/133

F497 SR 1994/428

F498 SR 2004/496

Special provisions for banking and insurance groups N.I.

263A .F499 —(1) The parent company of a banking group shall prepare group accounts in accordance with the provisions of this Part as modified by Part II of Schedule 9.

(2) The parent company of an insurance group[F500 shall] prepare group accounts in accordance with the provisions of this Part as modified by Part II of Schedule 9A.

(3) Accounts so prepared shall contain a statement that they are prepared in accordance with the special provisions of this Part relating to banking groups or to insurance groups, as the case may be.

[F500 (4) References in this Part to a banking group are to a group where the parent company is a banking company or where—

(a) the parent company's principal subsidiary undertakings are wholly or mainly credit institutions, and

(b) the parent company does not itself carry on any material business apart from the acquisition, management and disposal of interests in subsidiary undertakings.

(5) References in this Part to an insurance group are to a group where the parent company is an insurance company or where—

(a) the parent company's principal subsidiary undertakings are wholly or mainly insurance companies, and

(b) the parent company does not itself carry on any material business apart from the acquisition, management and disposal of interests in subsidiary undertakings.

(5A) For the purposes of paragraphs (4) and (5)—

(a) a parent company's principal subsidiary undertakings are the subsidiary undertakings of the company whose results or financial position would principally affect the figures shown in the group accounts, and

(b) the management of interests in subsidiary undertakings includes the provision of services to such undertakings.]

(6) In relation to the preparation of group accounts in accordance with the special provisions of this Part:

(a) the references to the provisions of Schedule 4A in[F501 Article 235A(4) and (5)] (relationship between specific requirements and duty to give true and fair view) shall be read as references to those provisions as modified by Part II of Schedule 9, in the case of the group accounts of a banking group, or Part II of Schedule 9A, in the case of the group accounts of an insurance group; and

(b) the reference to paragraphs 52 to 57 of Schedule 4 in Article 238(2) (relief from obligation to comply with those paragraphs where group accounts prepared) shall be read as a reference to[F502 paragraphs 75 to 77], 80 and 81 of Part I of Schedule 9, in the case of the group accounts of a banking group[F500 and as a reference to paragraphs 73, 74, 79 and 80 of Part I of Schedule 9A, in the case of the group accounts of an insurance group].

[F501 (6A) References to Companies Order group accounts include accounts prepared in accordance with paragraphs (1) to (3).

(6B) Paragraphs (1) to (3) and (6) do not apply to parent companies of banking groups or insurance groups that prepare IAS group accounts.]

Para. (7) rep. by SR 1994/428

F499 mod. SR 1994/133

F500 SR 1994/428

F501 SR 2004/496

F502 SR 1997/314

Modification of disclosure requirements in relation to banking company or group N.I.

263B .F503 —(1) In relation to a banking company, or the [F504 parent company of a banking group], the provisions of Schedule 5 (Disclosure of information: related undertakings) have effect subject to Part III of Schedule 9.

(2) In relation to a banking company, or the parent company of a banking company, the provisions of Schedule 6 (Disclosure of information: emoluments and other benefits of directors and others have effect subject to Part IV of Schedule 9.

F503 mod. SR 1994/133

F504 SR 1993/199

Art. 263C rep. by SR 1994/428

Power to apply provisions to banking partnerships N.I.

263D .F505 —(1) The Department may by regulations apply to banking partnerships, subject to such exceptions, adaptations and modifications as it considers appropriate, the provisions of this Part applying to banking companies.

[F506 (2) A “banking partnership” means a partnership which has permission under Part 4 of the Financial Services and Markets Act 2000.

(2A) But a partnership is not a banking partnership if it has permission to accept deposits only for the purpose of carrying on another regulated activity in accordance with that permission.]

(3) No regulations under this Article shall be made unless a draft of the regulations has been laid before and approved by a resolution of the Assembly.

[F506 (5) Paragraphs (2) and (2A) must be read with —

(a) section 22 of the Financial Services and Markets Act 2000;

(b) any relevant order under that section; and

(c) Schedule 2 to that Act.]

F505 mod. SR 1994/133

F506 SI 2001/3649

[F507 CHAPTER III]F1029 N.I. SUPPLEMENTARY PROVISIONS

F507 1990 NI 5

[F508 Accounting standards]F1029 N.I.

F508 1990 NI 5

Accounting standards N.I.

264 .F509 —(1) In this Part “accounting standards” means statements of standard accounting practice issued by such body or bodies as may be prescribed.

(2) References in this Part to accounting standards applicable to a company's annual accounts are to such standards as are, in accordance with their terms, relevant to the company's circumstances and to the accounts.

F510 (3) The Department may make grants to or for the purposes of bodies concerned with—

(a) issuing accounting standards,

(b) overseeing and directing the issuing of such standards, or

(c) investigating departures from such standards or from the accounting requirements of this Order and taking steps to secure compliance with them.

(4) Regulations under this Article may contain such transitional provisions as appear to the Department to be appropriate.

F509 mod. SR 1994/133

F510 prosp. rep. by 2005 NI 17

Power to alter accounting requirementsF1029 N.I.

Power of Department to alter accounting requirements N.I.

265 .F511 —(1) The Department may by regulations modify the provisions of this Part.

(2) Regulations which—

(a) add to the classes of documents required to be prepared, laid before the company in general meeting or delivered to the registrar,

(b) restrict the classes of company which have the benefit of any exemption, exception or special provision,

(c) require additional matter to be included in a document of any class, or

(d) otherwise render the requirements of this Part more onerous,

shall not be made unless a draft of the regulations has been laid before and approved by a resolution of the Assembly.

(3) Regulations under this Article may—

(a) repeal and re‐enact provisions with modifications of form or arrangement, whether or not they are modified in substance,

(b) make consequential amendments or repeals in other provisions of this Order, or in other statutory provisions;

(c) contain such transitional provisions as the Department thinks fit.

(4) Any modification by regulations under this Article of Article 266 or Schedule 10A (parent and subsidiary undertakings) does not apply for the purposes of statutory provisions outside the Companies Orders unless the regulations so provide.F512

F511 mod. SR 1994/133

F512 prosp. insertion by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

Parent and subsidiary undertakingsF1029 N.I.

Parent and subsidiary undertakings N.I.

266 .F513 —F514 (1) The expressions “parent undertaking” and “subsidiary undertaking” in this Part shall be construed as follows; and a “parent company” means a parent undertaking which is a company.

(2) An undertaking is a parent undertaking in relation to another undertaking, a subsidiary undertaking, if—

(a) it holds a majority of the voting rights in the undertaking, or

(b) it is a member of the undertaking and has the right to appoint or remove a majority of its board of directors, or

(c) it has the right to exercise a dominant influence over the undertaking—

(i) by virtue of provisions contained in the undertaking's memorandum or articles, or

(ii) by virtue of a control contract, or

(d) it is a member of the undertaking and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in the undertaking.

(3) For the purposes of paragraph (2) an undertaking shall be treated as a member of another undertaking—

(a) if any of its subsidiary undertakings is a member of that undertaking, or

(b) if any shares in that other undertaking are held by a person acting on behalf of the undertaking or any of its subsidiary undertakings.

(4) An undertaking is also a parent undertaking in relation to another undertaking, a subsidiary undertaking, ifF515 . . .

[F515 (a) it has the power to exercise, or actually exercises, dominant influence or control over it, or]

(b) it and the subsidiary undertaking are managed on a unified basis.

(5) A parent undertaking shall be treated as the parent undertaking of undertakings in relation to which any of its subsidiary undertakings are, or are to be treated as, parent undertakings; and references to its subsidiary undertakings shall be construed accordingly.

(6) Schedule 10A contains provisions explaining expressions used in this Article and otherwise supplementing this Article.

F513 mod. by SI 1994/1516

F514 mod. SR 1994/133

F515 SR 2004/496

[F516 Other interpretation provisions]F1029 N.I.

F516 1990 NI 5

Meaning of “undertaking” and related expressions N.I.

267 .F517 —(1) In this Part “undertaking” means—

(a) a body corporate or partnership, or

(b) an unincorporated association carrying on a trade or business, with or without a view to profit.

(2) In this Part references to shares—

(a) in relation to an undertaking with a share capital, are to allotted shares;

(b) in relation to an undertaking with capital but no share capital, are to rights to share in the capital of the undertaking; and

(c) in relation to an undertaking without capital, are to interests—

(i) conferring any right to share in the profits or liability to contribute to the losses of the undertaking, or

(ii) giving rise to an obligation to contribute to the debts or expenses of the undertaking in the event of a winding up.

(3) Other expressions appropriate to companies shall be construed, in relation to an undertaking which is not a company, as references to the corresponding persons, officers, documents or organs, as the case may be, appropriate to undertakings of that description.

This is subject to provision in any specific context providing for the translation of such expressions.

(4) References in this Part to “fellow subsidiary undertakings” are to undertakings which are subsidiary undertakings of the same parent undertaking but are not parent undertakings or subsidiary undertakings of each other.

(5) In this Part “group undertaking”, in relation to an undertaking, means an undertaking which is—

(a) a parent undertaking or subsidiary undertaking of that undertaking, or

(b) a subsidiary undertaking of any parent undertaking of that undertaking.

F517 mod. SR 1994/133

Participating interests N.I.

268 .F518 —(1) In this Part a “participating interest” means an interest held by an undertaking in the shares of another undertaking which it holds on a long‐term basis for the purpose of securing a contribution to its activities by the exercise of control or influence arising from or related to that interest.

(2) A holding of 20 per cent. or more of the shares of an undertaking shall be presumed to be a participating interest unless the contrary is shown.

(3) The reference in paragraph (1) to an interest in shares includes—

(a) an interest which is convertible into an interest in shares, and

(b) an option to acquire shares or any such interest;

and an interest or option falls within sub‐paragraph (a) or (b) notwithstanding that the shares to which it relates are, until the conversion or the exercise of the option, unissued.

(4) For the purposes of this Article an interest held on behalf of an undertaking shall be treated as held by it.

Para. (5) rep. by SR 2004/496

(6) In the balance sheet and profit and loss formats set out in Part I of Schedule 4,[F519 Part I of Schedule 8, Schedule 8A,][F520 , Chapter I of Part I of Schedule 9 and Chapter I of Part I of Schedule 9A] “participating interest” does not include an interest in a group undertaking.

(7) For the purposes of this Article as it applies in relation to the expression “participating interest”

(a) in those formats as they apply in relation to group accounts, and

(b) in paragraph 20 of Schedule 4A (group accounts: undertakings to be accounted for as associated undertakings),

the references in paragraphs (1) to (4) to the interest held by, and the purposes and activities of, the undertaking concerned shall be construed as references to the interest held by, and the purposes and activities of, the group (within the meaning of paragraph 1 of that Schedule).

F518 mod. SR 1994/133

F519 SR 1997/436

F520 SR 1994/428

Notes to the accounts N.I.

269 .F521 —(1) Information required by this Part to be given in notes to a company's annual accounts may be contained in the accounts or in a separate document annexed to the accounts.

(2) References in this Part to a company's annual accounts, or to a balance sheet or profit and loss account, include notes to the accounts giving information which is required by any provision of this Order[F522 or international accounting standards], and required or allowed by any such provision to be given in a note to company accounts.

F521 mod. SR 1994/133

F522 SR 2004/496

Minor definitions N.I.

270 .F523 — [F524 (1) In this Part—

• [F525 “address”, except in Article 236, in relation to electronic communications, includes any number or address used for the purposes of such communications;]

• “annual accounts” means—

  (a)

  the individual accounts required by Article 234, and

  (b)

  any group accounts required by Article 235,

  (but see also Article 238 (treatment of individual profit and loss account where group accounts prepared));

• “annual report”, in relation to a company, means the directors' report required by Article 242;

• “balance sheet date” means the date as at which the balance sheet was made up;

• “capitalisation”, in relation to work or costs, means treating that work or those costs as a fixed asset;

• [F526 “Companies Order accounts” means Companies Order individual accounts or Companies Order group accounts;]

• [F527 “credit institution” means a credit institution as defined in article 1(1)(a) of Directive 2001/12/EC of the European Parliament and of the Council of 20th March 2000 relating to the taking up and pursuit of the business of credit institutions, that is to say an undertaking whose business is to receive deposits or other repayable funds from the public and to grant credit for its own account;]

• Definition rep. by SR 2004/263

• [F528 “e-money issuer” means a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on the activity of issuing electronic money within the meaning of article 9B of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;]

• “fixed assets” means assets of a company which are intended for use on a continuing basis in the company's activities, and “current assets” means assets not intended for such use;

• “group” means a parent undertaking and its subsidiary undertakings;

• [F526 “IAS accounts” means IAS individual accounts or IAS group accounts;]

• [F526 “IAS Regulation” means EC Regulation No. 1606/2002 of the European Parliament and of the Council of 19th July 2002 on the application of international accounting standards;]

• “included in the consolidation”, in relation to group accounts, or “included in consolidated group accounts”, means that the undertaking is included in the accounts by the method of full (and not proportional) consolidation, and references to an undertaking excluded from consolidation shall be construed accordingly;

• [F526 “international accounting standards” means the international accounting standards, within the meaning of the IAS Regulation, adopted from time to time by the European Commission in accordance with that Regulation;]

• [F529 “ISD investment firm” has the same meaning as in the General Provisions and Glossary Instrument 2001 made by the Financial Services Authority under the Financial Services and Markets Act 2000;]

• [F526 “profit and loss account”, in relation to a company that prepares IAS accounts, includes an income statement or other equivalent financial statement required to be prepared by international accounting standards;]

• “purchase price”, in relation to an asset of a company or any raw materials or consumables used in the production of such an asset, includes any consideration (whether in cash or otherwise) given by the company in respect of that asset or those materials or consumables, as the case may be;

• “qualified”, in relation to an auditors' report, means that the report does not state the auditors' unqualified opinion that the accounts have been properly prepared in accordance with this Order or, in the case of an undertaking not required to prepare accounts in accordance with this Order, under any corresponding legislation under which it is required to prepare accounts;

• [F530 “quoted company” means a company whose equity share capital‐

  (a)

  has been included in the official list in accordance with the provisions of Part VI of the Financial Services and Markets Act 2000; or

  (b)

  is officially listed in an EEA State; or

  (c)

  is admitted to dealing on either the New York Stock Exchange or the exchange known as Nasdaq;

  and in sub-paragraph (a) the official list shall have the meaning given it by section 103(1) of the Financial Services and Markets Act 2000;]

• [F531 “regulated activity” has the meaning given by Article 2, except that it does not include activities of the kind specified in any of the following provisions of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001—

  (a)

  article 25A (arranging regulated mortgage contracts),

  (aa)

  [F532 article 25B (arranging regulated home reversion plans),

  (ab)

  article 25B (arranging regulated home purchase plans),]

  (b)

  article 39A (assisting administration and performance of a contract of insurance),

  (c)

  article 53A (advising on regulated mortgage contracts), F533 . . .

  (ca)

  [F534 article 53B (advising on regulated home reversion plans),

  (cb)

  article 25B (advising on regulated home purchase plans),]

  (d)

  article 21 (dealing as agent), article 25 (arranging deals in investments) or article 53 (advising on investments) where the activity concerns relevant investments that are not contractually based investments (within the meaning of article 3 of that Order); [F535 , or]

  (e)

  [F536 article 64 (agreeing to carry on a regulated activity of the kind mentioned in paragraphs (a) to (d) above);]]

• Definition rep. by SR 2004/496

• “turnover”, in relation to a company, means the amounts derived from the provision of goods and services falling within the company's ordinary activities, after deduction of—

  (i)

  trade discounts,

  (ii)

  value added tax, and

  (iii)

  any other taxes based on the amounts so derived.

• [F537 “UCITS management company” has the same meaning as in the Collective Investment Schemes (UCITS Amending Directive) Instrument 2003 made by the Financial Services Authority under the Financial Services and Markets Act 2000.]

(2) In the case of an undertaking not trading for profit, any reference in this Part to a profit and loss account is to an income and expenditure account; and references to profit and loss and, in relation to group accounts, to a consolidated profit and loss account shall be construed accordingly.

[F526 (2A) References in this Part to accounts giving a “true and fair view” are references—

(a) in the case of Companies Order individual accounts, to the requirement under Article 234A that such accounts give a true and fair view;

(b) in the case of Companies Order group accounts, to the requirement under Article 235A that such accounts give a true and fair view; and

(c) in the case of IAS accounts, to the requirement under international accounting standards that such accounts achieve a fair presentation.]

(3) References in this Part to “realised profits” and “realised losses”, in relation to a company's accounts, are to such profits or losses of the company as fall to be treated as realised in accordance with principles generally accepted, at the time when the accounts are prepared, with respect to the determination for accounting purposes of realised profits or losses.

This is without prejudice to—

(a)

the construction of any other expression (where appropriate) by reference to accepted accounting principles or practice, or

(b)

any specific provision for the treatment of profits or losses of any description as realised.]

F523 mod. SR 1994/133

F524 Art. 270 repealed (20.1.2007 for the definition of "address" and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

F525 SR 2003/3

F526 SR 2004/496

F527 SI 2002/765

F528 Art. 270(1): definition of "e-money issuer" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(2)

F529 Art. 270(1): definition of "ISD investment firm" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(2)

F530 SR 2005/56

F531 Art. 270: definition of "regulated activity" inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 16(1)

F532 Art. 270(1): words inserted (1.12.2006) in definition of "regulated activity" by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(3)(a)

F533 Art. 270(1): word deleted (1.12.2006) in definition of "regulated activity" by virtue of Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(3)(b)

F534 Art. 270(1): words inserted (1.12.2006) in definition of "regulated activity" by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(3)(b)

F535 Art. 270(1): words inserted (1.12.2006) in definition of "regulated activity" by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(3)(c)

F536 Art. 270(1): words inserted (1.12.2006) in definition of "regulated activity" by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(3)(c)

F537 Art. 270(1): definition of "UCITS management company" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(2)

Index of defined expressions N.I.

270A.  F538 The following Table shows the provisions of this Part defining or otherwise explaining expressions used in this Part (other than expressions used only in the same Article or paragraph)—

[F539 accounting reference date and accounting reference period]	[F539 Article 232]
[F539 accounting standards and applicable accounting standards]	[F539 Article 264]
[F540 address]	[F540 Article 270(1)]
[F539 annual accounts]
[F539 (generally)]	[F539 Article 270(1)]
[F539 (includes notes to the accounts)]	[F539 Article 269(2)]
[F539 annual report]	[F539 Article 270(1)]
[F539 associated undertaking (in Schedule 4A)]	[F539 paragraph 20 of that Schedule]
[F541 auditable part (of a directors' remuneration report)]	[F541 Article 243(5)]
[F539 balance sheet (includes notes)]	[F539 Article 269(2)]
[F539 balance sheet date]	[F539 Article 270(1)]
[F542 banking activities (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F539 banking group]	[F542 Article 263A(4)]
[F542 banking transcations (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F539 capitalisation (in relation to work or costs)]	[F539 Article 270(1)]
[F543 Companies Order accounts]	[F543 Section 270(1)]
[F543 Companies Order group accounts]	[F543 Articles 235(2) and 263A(6A)]
[F543 Companies Order individual accounts]	[F543 Articles 234(2) and 263(4A)]
[F539 credit institution]	[F539 Article 270(1)]
[F539 current assets]	[F539 Article 270(1)]
[F544 directors' report]	[F544 Article 242]
F545 . . .	F545 . . .
[F546 e-money issuer]	[F547 Article 270]
[F539 fellow subsidiary undertaking]	[F539 Article 267(4)]
[F542 financial fixed assets (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F539 financial year]	[F539 Article 231]
[F539 fixed assets]	[F539 Article 270(1)]
[F548 general business (in Schedule 9)]	[F548 paragraph 81 of Pt I of that Schedule]
[F539 group]	[F539 Article 270(1)]
[F543 group accounts]	[F543 Article 235(1)]
[F544 group directors' report]	[F544 Article 242]
F549 . . .	F549 . . .
[F539 group undertaking]	[F539 Article 267(5)]
[F542 historical cost accounting rules]
[F542 — in Schedule 4]	[F542 paragraph 29 of that Schedule]
[F550 — in Schedule 8]	[F550 paragraph 29 of that Schedule]
[F542 — in Schedule 9]	[F542 paragraph 39 of Part I of that Schedule]
[F548 — in Schedule 9A]	[F548 paragraph 29(b) of Part I of that Schedule]
[F543 IAS accounts]	[F543 Article 270(1)]
[F543 IAS group accounts]	[F543 Article 235(2) and (3)]
[F543 IAS individual accounts]	[F543 Article 234(2)]
[F543 IAS Regulation]	[F543 Article 270(1)]
[F539 included in the consolidation and related expressions]	[F539 Article 270(1)]
[F539 individual accounts]	[F539 Article 234(1)]
[F539 insurance group]	[F542 Article 263A(5)]
[F543 international accounting standards]	[F543 Article 270(1)]
[F551 ISD investment firm]	[F552 Article 270]
[F539 lease, long lease and short lease]
[F539 —in Schedule 4]	[F539 paragraph 82 of that Schedule]
[F542 —in Schedule 9]	[F542 paragraph 82 of Part I of that Schedule]
[F539 —in][F548 Schedule 9A]	[F548 paragraph 81 of Part I that Schedule]
[F539 listed investment]
[F539 —in Schedule 4]	[F539 paragraph 83 of that Schedule]
[F550 —in Schedule 8]	[F550 paragraph 54 of that Schedule]
[F539 —in][F548 Schedule 9A]	[F548 paragraph 81 of Part I of that Schedule]
[F542 listed security (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F548 long term business (in Schedule 9A)]	[F548 paragraph 81 of Part I of that Schedule]
[F548 long term fund (in Schedule 9A)]	[F548 paragraph 81 of Part I of that Schedule]
[F539 notes to the accounts]	[F539 Article 269(1)]
F553 . . .	F553 . . .
[F539 parent undertaking (and parent company)]	[F539 Article 266 and Schedule 10A]
[F539 participating interest]	[F539 Article 268]
[F550 pension costs]
[F550 — in Schedule 4]	[F550 paragraph 92(2) of that Schedule]
[F550 — in Schedule 8]	[F550 paragraph 59(2) of that Schedule]
[F550 — in Schedule 9]	[F550 paragraph 86(b) of Part I of that Schedule]
[F550 — in Schedule 9A]	[F550 paragraph 85(b) of Part I of that Schedule]
[F539 period allowed for laying and delivering accounts and reports]	[F539 Article 252]
[F548 policy holder (in Schedule 9A)]	[F548 paragraph 81 of Part I of that Schedule]
[F539 profit and loss account]
[F539 (includes notes)]	[F539 Article 269(2)]
[F543 (in relation to IAS accounts)]	[F543 Article 270(1)]
[F539 (in relation to a company not trading for profit)]	[F539 Article 270(2)]
[F539 provision]
[F539 —in Schedule 4]	[F539 paragraphs 87 and 88 of that Schedule]
[F550 — in Schedule 8]	[F550 paragraphs 57 and 58 of that Schedule]
[F542 —in Schedule 9]	[F542 paragraph 85 of Part I of that Schedule]
[F539 —in][F548 Schedule 9A]	[F548 paragraph 84 of Part I of that Schedule]
[F539 —in][F548 provision for unexpired risks (in Schedule 9A)]	[F548 paragraph 81 of Part I of that Schedule]
[F539 purchase price]	[F539 Article 270(1)]
[F539 qualified]	[F539 Article 270(1)]
[F541 quoted company]	[F541 Article 270(1)]
[F539 realised losses and realised profits]	[F539 Article 270(3)]
[F554 “regulated activity”]	[F555 Articles 2 and 270.]
[F542 repayable on demand (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F556 reporting accountant]	[F556 Article 257C(1)]
[F539 reserve (in[F542 Schedule 9A])]	[F539 paragraph 32 of that Schedule]
[F542 sale and repurchase transaction (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F542 sale and option to resell transaction (in Schedule 9)]	[F542 paragraph 82 of Part I of that Schedule]
[F539 shares]	[F539 Article 267(2)]
[F542 social security costs]
[F542 — in Schedule 4]	[F542 paragraph 92(1) and (3) of that Schedule]
[F550 — in Schedule 8]	[F550 paragraphs 59(1) and (3) of that Schedule]
[F542 — in Schedule 9]	[F542 paragraph 86(a) and (c) of Part I of that Schedule]
[F548 — in Schedule 9A]	[F548 paragraph 85(a) and (c) of Part I of that Schedule]
[F539 special provisions for banking and insurance companies and groups]	[F539 Articles 263 and 263A]
[F539 subsidiary undertaking]	[F539 Article 266 and Schedule 10A]
[F548 the 1982 Act (in Schedule 9A)]	[F548 paragraph 81 of Part I of that Schedule]
[F543 true and fair view]	[F543 Article 270(2A)]
[F539 turnover]	[F539 Article 270(1)]
[F557 UCITS management company]	[F558 Article 270]
[F539 undertaking and related expressions]	[F539 Article 267(1) to (3).]

F538 Art. 270A repealed (20.1.2007 for the entry "address" and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

F539 1990 NI 5

F540 SR 2003/3

F541 SR 2005/56

F542 SR 1992/258

F543 SR 2004/496

F544 SR 2005/61

F545 SR 2004/263

F546 Art. 270A: entry relating to "e-money issuer" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(4)

F547 Art. 270A: entry relating to "e-money issuer" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(4)

F548 SR 1994/428

F549 Art. 270A: entry relating to "group operating and financial review" omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 14

F550 SR 1997/436

F551 Art. 270A: entry relating to "ISD investment firm" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(4)

F552 Art. 270A: entry relating to "ISD investment firm" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(4)

F553 Art. 270A: entry relating to "operating and financial review" omitted (31.3.2006) by virtue of Companies (1986 Order) (Operating and Financial Review) (Repeal) Regulations (Northern Ireland) 2006 (S.R. 2006/94), reg. 2(2), Sch. para. 14

F554 Art. 270A: entry relating to "regulated activity" inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 16(2)

F555 Art. 270A: entry relating to "regulated activity" inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 16(2)

F556 SR 1995/128

F557 Art. 270A: entry relating to "UCITS management company" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(4)

F558 Art. 270A: entry relating to "UCITS management company" inserted (1.12.2006) by Companies (1986 Order) (Small Companies' Accounts and Audit) Regulations (Northern Ireland) 2006 (S.R. 2006/438), reg. 6(4)

PART IXF1029 N.I. DISTRIBUTION OF PROFITS AND ASSETS

Limits of company's power of distributionF1029 N.I.

Certain distributions prohibited N.I.

271.—(1) A company shall not make a distribution except out of profits available for the purpose.

(2) In this Part, “distribution” means every description of a company's assets to its members, whether in cash or otherwise, except distribution by way of—

(a) an issue of shares as fully or partly paid bonus shares,

(b) the redemption or purchase of any of the company's own shares out of capital (including the proceeds of any fresh issue of shares) or out of unrealised profits in accordance with Chapter VII of Part VI,

(c) the reduction of share capital by extinguishing or reducing the liability of any of the members on any of the company's shares in respect of share capital not paid up, or by paying off paid-up share capital, and

(d) a distribution of assets to members of the company on its winding up.

(3) For the purposes of this Part, a company's profits available for distribution are its accumulated, realised profits, so far as not previously utilised by distribution or capitalisation, less its accumulated, realised losses, so far as not previously written off in a reduction or reorganisation of capital duly made.

This is subject to the provision made by Articles 273 and 274 for investment and other companies.

(4) A company shall not apply an unrealised profit in paying up debentures, or any amounts unpaid on its issued shares.

(5) Where the directors of a company are, after making all reasonable enquiries, unable to determine whether a particular profit made before 1st July 1983 is realised or unrealised, they may treat the profit as realised; and where after making such enquiries they are unable to determine whether a particular loss so made is realised or unrealised, they may treat the loss as unrealised.

Restriction on distribution of assets N.I.

272.—(1) A public company may only make a distribution at any time—

(a) if at that time the amount of its net assets is not less than the aggregate of its called-up share capital and undistributable reserves, and

(b) if, and to the extent that, the distribution does not reduce the amount of those assets to less than that aggregate.

This is subject to the provision made by Articles 273 and 274 for investment and other companies.

(2) In paragraph (1), “net assets” means the aggregate of the company's assets less the aggregate of its liabilities ( “liabilities” to include any[F559 provision for liabilities] within paragraph 88 of Schedule 4[F559 that is made in Companies Order accounts and any provision that is made in IAS accounts]).

(3) A company's undistributable reserves are—

(a) the share premium account,

(b) the capital redemption reserve,

(c) the amount by which the company's accumulated, unrealised profits, so far as not previously utilised by capitalisation of a description to which this sub-paragraph applies, exceed its accumulated, unrealised losses (so far as not previously written off in a reduction or reorganisation of capital duly made), and

(d) any other reserve which the company is prohibited from distributing by any statutory provision (other than one contained in this Part) or by its memorandum or articles,

and, sub-paragraph (c) applies to every description of capitalisation except a transfer of profits of the company to its capital redemption reserve on or after 1st July 1983.

(4) A public company shall not include any uncalled share capital as an asset in any accounts relevant for the purposes of this Article.

F559 SR 2004/496

Modifications etc. (not altering text)

C6 Art. 272(3)(c) modified (1.1.2007) by Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336 (N.I. 21)), arts. 1(3)(c), 275(3) (with arts. 8(8), 121(3), 307)

C7 Art. 272(3)(d) modified (1.1.2007) by Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336 (N.I. 21)), arts. 1(3)(c), 275(3) (with arts. 8(8), 121(3), 307)

Other distributors by investment companies N.I.

273.—(1) Subject to the following provisions of this Article, an investment company (defined in Article 274) may also make a distribution at any time out of its accumulated, realised revenue profits, so far as not previously utilised by distribution or capitalisation, less its accumulated revenue losses (whether realised or unrealised), so far as not previously written off in a reduction or reorganisation of capital duly made—

(a) if at that time the amount of its assets is at least equal to one and a half times the aggregate of its liabilities [F560 to creditors] , and

(b) if, and to the extent that, the distribution does not reduce that amount to less than one and a half times that aggregate.

(2) In paragraph (1)(a) “liabilities [F561 to creditors]” includes any provision for liabilities [F561 to creditors] or charges (within the meaning of paragraph 88 of Schedule 4[F562 that is made in Companies Order accounts and any provision [F563 for liabilities to creditors] that is made in IAS accounts]).

(3) The company shall not include any uncalled share capital as an asset in any accounts relevant for the purposes of this Article.

(4) An investment company may not make a distribution by virtue of paragraph (1) unless—

(a) its shares are listed on a[F564 recognised investment exchange other than an overseas investment exchangeF565 . . . ], and

(b) during the relevant period it has not—

(i) distributed any of its capital profits[F566 otherwise than by way of the redemption or purchase of any of the company's own shares in accordance with Article 170 or 172 in Chapter VII of Part VI], or

(ii) applied any unrealised profits or any capital profits (realised or unrealised) in paying up debentures or amounts unpaid on its issued shares.

[F565 (4A) In paragraph (4)(a) "recognised investment exchange" and "overseas investment exchange" have the same meaning as in Part 18 of the Financial Services and Markets Act 2000.]

(5) The “relevant period” under paragraph (4) is the period beginning with—

(a) the first day of the accounting reference period immediately preceding that in which the proposed distribution is to be made, or

(b) where the distribution is to be made in the company's first accounting reference period, the first day of that period,

and ending with the date of the distribution.

(6) An investment company may not make a distribution by virtue of paragraph (1) unless the company gave to the registrar the requisite notice (that is, notice under Article 274(1)) of the company's intention to carry on business as an investment company—

(a) before the beginning of the relevant period under paragraph (4), or

(b) in the case of a company incorporated on or after 1st July 1983, as soon as may have been reasonably practicable after the date of its incorporation.

F560 Words in art. 273(1)(a) inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 2(2)

F561 Words in art. 273(2) inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 2(3)(a)

F562 SR 2004/496

F563 Words in art. 273(2) inserted (1.4.2006) by Companies (1986 Order) (Investment Companies and Accounting and Audit Amendments) Regulations (Northern Ireland) 2006 (S.R. 2006/137), reg. 2(3)(b)

F564 1986 c. 60

F565 SI 2001/3649

F566 SR 2004/22

Meaning of “investment company” N.I.

274.—(1) In Article 273 “investment company” means a public company which has given notice in the prescribed form (which has not been revoked) to the registrar of its intention to carry on business as an investment company, and has since the date of that notice complied with the requirements specified in paragraph (2).

(2) Those requirements are—

(a) that the business of the company consists of investing its funds mainly in securities, with the aim of spreading investment risk and giving members of the company the benefit of the results of the management of its funds,

(b) that none of the company's holdings in companies (other than those which are for the time being investment companies) represents more than 15 per cent. by value of the investing company's investments,

(c) that[F567 subject to paragraph (2A),] distribution of the company's capital profits is prohibited by its memorandum or articles,

(d) that the company has not retained, otherwise than in compliance with this Part, in respect of any accounting reference period more than 15 per cent. of the income it derives from securities.

[F567 (2A) An investment company need not be prohibited by its memorandum or articles from redeeming or purchasing its own shares in accordance with Article 170 or 172 in Chapter VII of Part VI out of its capital profits.]

(3) Notice to the registrar under paragraph (1) may be revoked at any time by the company on giving notice in the prescribed form to the registrar that it no longer wishes to be an investment company within the meaning of this Article; and, on giving such notice, the company ceases to be such a company.

[F568 (4) Subsections (1A) to (3) of section 842 of the Income and Corporation Taxes Act 1988 apply for the purposes of paragraph (2)(b) as for those of subsection (1)(b) of that section.]

F567 SR 2004/22

F568 1988 c. 39

Extension of Articles 273 and 274 to other companies N.I.

275.—(1) The Department may by regulations extend the provisions of Articles 273 and 274 (with or without modifications) to companies whose principal business consists of investing their funds in securities, land or other assets with the aim of spreading investment risk and giving their members the benefit of the results of the management of the assets.

(2) Regulations under this Article shall not be made unless a draft of the regulations has been laid before, and approved by a resolution of, the Assembly.

Realised profits of insurance company with long term business N.I.

276.—(1) Where [F569 an authorised insurance company] carries on long term business—

[F570 (a) any amount included in the relevant part of the balance sheet of the company which represents a surplus in the fund or funds maintained by it in respect of that business and which has not been allocated to policy holders[F569 or, as the case may be, carried forward unappropriated, in accordance with asset identification rules made under section 142(2) of the Financial Services and Markets Act 2000], and]

(b) any deficit in that fund or those funds,

are to be (respectively) treated, for the purposes of this Part, as a realised profit and a realised loss; and, subject to this, any profit or loss arising in that business is to be left out of account for those purposes.

(2) In paragraph (1)—

(a) the reference to a surplus in any fund or funds of an insurance company is to an excess of the assets representing that fund or those funds over the liabilities of the company attributable to its long term business, as shown by an actuarial investigation, and

[F570 (aa) the reference to the relevant part of the balance sheet is

[F571 (i)] [F571 in the case of Companies Order individual accounts,] to that part of the balance sheet which represents Liabilities item A.V. (profit and loss account) in the balance sheet format set out in section B of Chapter I of Part I of Schedule 9A,[F571 and]

[F571 (ii) in the case of IAS individual accounts, to that part of the balance sheet which represents accumulated profit or loss,]]

(b) the reference to a deficit in any such fund or funds is to the excess of those liabilities over those assets, as so shown.

(3) In this Article—

[F569 (a) “actuarial investigation” means—

(i) an investigation made into the financial condition of an authorised insurance company in respect of its long term business, carried out once in every period of twelve months in accordance with rules made under Part 10 of the Financial Services and Markets Act 2000 by an actuary appointed as actuary to that company; or

(ii) an investigation made into the financial condition of an authorised insurance company in respect of its long term business carried out in accordance with a requirement imposed by the Financial Services Authority under section 166 of that Act by an actuary appointed as actuary to that company;]

[F569 (b) “long term business” means business which consists of effecting or carrying out contracts of long term insurance.]

[F569 (4) The definition of "long term business" in paragraph (3) must be read with—

(a) section 22 of the Financial Services and Markets Act 2000;

(b) any relevant order under that section; and

(c) Schedule 2 to that Act.]

F569 SI 2001/3649

F570 SR 1997/314

F571 SR 2004/496

Treatment of development costs N.I.

277.—(1) Subject as follows, where development costs are shown as an asset in a company's accounts, any amount shown in respect of those costs is to be treated—

(a) under Article 271, as a realised loss, and

(b) under Article 273, as a realised revenue loss.

(2) This does not apply to any part of that amount representing an unrealised profit made on revaluation of those costs; nor does it apply if—

(a) there are special circumstances in the company's case justifying the directors in deciding that the amount there mentioned is not to be treated as required by paragraph (1),F572 . . .

(b) [F572 it is stated—]

[F572 (i)] [F572 in the case of Companies Order individual accounts, in] the note to the accounts required by paragraph 20 of Schedule 4[F573 or paragraph 20 of Schedule 8] (reasons for showing development costs as an asset)[F572 , or]

[F572 (ii)] [F572 in the case of IAS individual accounts, in any note to the accounts,] that the amount is not to be so treated[F572 , and]

[F572 (c)] [F572 the note explains] the circumstances relied upon to justify the decision of the directors to that effect.

F572 SR 2004/496

F573 SR 1997/436

Relevant accountsF1029 N.I.

Distribution to be justified by reference to company's accounts N.I.

278.—(1) This Article and Articles 279 to 284 are for determining the question whether a distribution may be made by a company without contravening Article 271, 272 or 273.

(2) The amount of a distribution which may be made is determined by reference to the following items as stated in the company's accounts—

(a) profits, losses assets and liabilities,

(b) [F574 the following provisions—]

[F574 (i)] [F574 in the case of Companies Order individual accounts,] provisions of any of the kinds mentioned in paragraphs 87 and 88 of Schedule 4 (depreciation, diminution in value of assets, retentions to meet liabilities, etc.)[F574 , and]

[F574 (ii)] [F574 in the case of IAS individual accounts, provisions of any kind], and

(c) share capital and reserves (including undistributable reserves).

(3) Except in a case falling within paragraph (4), the company's accounts which are relevant for this purpose are its last annual accounts, [F575 that is to say—

(a) in the case of a private company, those prepared under Part 8 that were last sent to members in accordance with Article 246(1);

(b) in the case of a public company, those prepared under Part 8 which were laid in respect of the last preceding accounting reference period in respect of which accounts so prepared were laid (and for this purpose accounts are laid if Article 249(1) has been complied with in relation to them).]

(4) In the following two cases—

(a) where the distribution would be found to contravene the relevant Article if reference were made only to the company's last annual accounts, or

(b) where the distribution is proposed to be declared during the company's first accounting reference period, or before any accounts are laid in respect of that period,

the accounts relevant under this Article (called “interim accounts” in the first case, and “initial accounts” in the second) are those necessary to enable a reasonable judgement to be made as to the amounts of the items mentioned in paragraph (2).

(5) The relevant Article is treated as contravened in the case of a distribution unless the statutory requirements about the relevant accounts (that is, the requirements of this Article and Articles 279 to 281 as and where applicable) are complied with in relation to that distribution.

F574 SR 2004/496

F575 Words in art. 278(3) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(6) (with art. 12)

Requirements for last annual accounts N.I.

279.—(1) If the company's last annual accounts constitute the only accounts relevant under Article 278, the statutory requirements in respect of them are as follows.

(2) The accounts must have been properly prepared in accordance with this Order, or have been so prepared subject only to matters which are not material for determining, by reference to items mentioned in Article 278(2), whether the distribution would contravene the relevant Article; and, without prejudice to the foregoing—

(a) so much of the accounts as consists of a balance sheet must give a true and fair view of the state of the company's affairs as at the balance sheet date, and

(b) so much of the accounts as consists of a profit and loss account must give a true and fair view of the company's profit or loss for the period in respect of which the accounts were prepared.

(3) The auditors must have made their report on the accounts under[F576 Article 243]; and paragraph (4) applies if the report is a qualified report, that is to say, it is not a report without qualification to the effect that in the auditors' opinion the accounts have been properly prepared in accordance with this Order.

(4) The auditors must in that case also have stated in writing (either at the time of their report or subsequently) whether, in their opinion, the matter in respect of which their report is qualified is material for determining, by reference to items mentioned in Article 278(2), whether the distribution would contravene the relevant Article. F577 . . .

[F578 (4A) A copy of the auditors' statement under paragraph (4) must—

(a) in the case of a private company, have been circulated to members along with the copies of the accounts sent to them under Article 246(1);

(b) in the case of a public company, have been laid before the company in general meeting.]

(5) A statement under paragraph (4) suffices for the purposes of a particular distribution not only if it relates to a distribution which has been proposed but also if it relates to distributions of any description which includes that particular distribution, notwithstanding that at the time of the statement it has not been proposed.

F576 1990 NI 5

F577 Words in art. 279(4) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(7) (with art. 12)

F578 Art. 279(4A) inserted (1.10.2007 with effect as mentioned in Sch. 4 para. 19(8) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 19(7) (with art. 12)

Requirements for interim accounts N.I.

280.—(1) The following are the statutory requirements in respect of interim accounts prepared for a proposed distribution by a public company.

(2) The accounts must have been properly prepared, or have been so prepared subject only to matters which are not material for determining, by reference to items mentioned in Article 278(2), whether the proposed distribution would contravene the relevant Article.

(3) “Properly prepared” means that the accounts must comply with[F579 Article 234] (applying that Article[F580 and Articles 234A and 234B] and Schedule 4 with such modifications as are necessary because the accounts are prepared otherwise than in respect of an accounting reference period) and any balance sheet comprised in the accounts must have been signed in accordance with[F579 Article 241]; and, without prejudice to the foregoing—

(a) so much of the accounts as consists of a balance sheet must give a true and fair view of the state of the company's affairs as at the balance sheet date, and

(b) so much of the accounts as consists of a profit and loss account must give a true and fair view of the company's profit or loss for the period in respect of which the accounts were prepared.

(4) A copy of the accounts must have been delivered to the registrar.

(5) If the accounts are in a language other than English and[F579 the second sentence of Article 250(1)] (translation) does not apply, a translation into English of the accounts, certified in the prescribed manner to be a correct translation, must also have been delivered to the registrar.

F579 1990 NI 5

F580 SR 2004/496

Requirements for initial accounts N.I.

281.—(1) The following are the statutory requirements in respect of initial accounts prepared for a proposed distribution by a public company.

(2) The accounts must have been properly prepared, or they must have been so prepared subject only to matters which are not material for determining, by reference to items mentioned in Article 278(2), whether the proposed distribution would contravene the relevant Article.

(3) Article 280(3) applies as respects the meaning of “properly prepared”.

(4) The company's auditors must have made a report stating whether in their opinion the accounts have been properly prepared; and paragraph (5) applies if their report is a qualified report, that is to say, it is not a report without qualification to the effect that in the auditors' opinion the accounts have been so prepared.

(5) The auditors must in that case also have stated in writing whether, in their opinion, the matter in respect of which their report is qualified is material for determining, by reference to items mentioned in Article 278(2), whether the distribution would contravene the relevant Article.

(6) A copy of the accounts, of the auditors' report under paragraph (4) and of the auditors' statement (if any) under paragraph (5) must have been delivered to the registrar.

(7) If the accounts are, or the auditors' report under paragraph (4) or their statement (if any) under paragraph (5) is, in a language other than English and[F581 the second sentence of Article 250(1)] (translation) does not apply, a translation into English of the accounts, the report or the statement (as the case may be), certified in the prescribed manner to be a correct translation, must also have been delivered to the registrar.

F581 1990 NI 5

Method of apply Article 278 so successive distributions N.I.

282.—(1) For the purpose of determining by reference to particular accounts whether a proposed distribution may be made by a company, Article 278 has effect, in a case where one or more distributions have already been made in pursuance of determinations made by reference to those same accounts, as if the amount of the proposed distribution was increased by the amount of the distributions so made.

(2) Paragraph (1) applies (if it would not otherwise do so) to—

(a) financial assistance lawfully given by a public company out of its distributable profits in a case where the assistance is required to be so given by Article 164,

(b) financial assistance lawfully given by a private company out of its distributable profits in a case where the assistance is required to be so given by Article 165(2),

(c) financial assistance given by a company in contravention of Article 161, in a case where the giving of that assistance reduces the company's net assets or increases its net liabilities,

(d) a payment made by a company in respect of the purchase by it of shares in the company (except by payment lawfully made otherwise than out of distributable profits), and

(e) a payment of any description specified in Article 178 (company's purchase of right to acquire its own shares, etc).

being financial assistance given or payment made since the relevant accounts were prepared, as if any such financial assistance or payment were a distribution already made in pursuance of a determination made by reference to those accounts.

(3) In this Article—

• “financial assistance” means the same as in Chapter VI of Part VI,

• “net assets” has the meaning given by Article 164(2)(a), and

• “net liabilities”, in relation to the giving of financial assistance by a company, means the amount by which the aggregate amount of the company's liabilities within the meaning of Article 164(2)(b) exceeds the aggregate amount of its assets, taking the amount of the assets and liabilities to be as stated in the company's accounting records immediately before the financial assistance is given.

(4) Paragraphs (2) and (3) are deemed to be included in Chapter VII of Part VI for the purposes of the Department's power to make regulations under Article 189.

Treatment of assets in the relevant accounts N.I.

283.— [F582 (1) For the purposes of Articles 271 and 272, the following are treated as realised losses—

(a) in the case of Companies Order individual accounts, provisions of any kind mentioned in paragraphs 87 and 88 of Schedule 4 (other than revaluation provisions), and

(b) in the case of IAS individual accounts, provisions of any kind (other than revaluation provisions).

(1A) In paragraph (1), a revaluation provision means a provision in respect of a diminution in value of a fixed asset appearing on a revaluation of all the fixed assets of the company, or of all of its fixed assets other than goodwill.]

(2) If, on the revaluation of a fixed asset, an unrealised profit is shown to have been made and, on or after the revaluation, a sum is written off or retained for depreciation of that asset over a period, then an amount equal to the amount by which that sum exceeds the sum which would have been so written off or retained for the depreciation of that asset over that period, if that profit had not been made, is treated for the purposes of Articles 271 and 272 as a realised profit made over that period.

(3) Where there is no record of the original cost of an asset, or a record cannot be obtained without unreasonable expense or delay, then for the purpose of determining whether the company has made a profit or loss in respect of that asset, its cost is taken to be the value ascribed to it in the earliest available record of its value made on or after its acquisition by the company.

(4) Subject to paragraph (6), any consideration by the directors of the value at a particular time of a fixed asset is treated as a revaluation of the asset for the purposes of determining whether any such revaluation of the company's fixed assets as is required for the purposes of the exception from paragraph (1) has taken place at that time.

(5) But where any such assets which have not actually been revalued are treated as revalued for those purposes under paragraph (4), that exception applies only if the directors are satisfied that their aggregate value at the time in question is not less than the aggregate amount at which they are for the time being stated in the company's accounts.

(6) Where Article 279(2), 280(2) or 281(2) applies to the relevant accounts, paragraphs (4) and (5) do not apply for the purpose of determining whether a revaluation of the company's fixed assets affecting the amount of the relevant items (that is, the items mentioned in Article 278(2)) as stated in those accounts has taken place, unless it is stated in a note to the accounts—

(a) that the directors have considered the value at any time of any fixed assets of the company, without actually revaluing those assets,

(b) that they are satisfied that the aggregate value of those assets at the time in question is or was not less than the aggregate amount at which they are or were for the time being stated in the company's accounts, and

(c) that the relevant items in question are accordingly stated in the relevant accounts on the basis that a revaluation of the company's fixed assets which by virtue of paragraphs (4) and (5) included the assets in question took place at that time.

F582 SR 2004/496

Distributors in kind N.I.

284.  Where a company makes a distribution of or including a non-cash asset, and any part of the amount at which that asset is stated in the accounts relevant for the purposes of the distribution in accordance with Articles 278 to 283 represents an unrealised profit, that profit is to be treated as a realised profit—

(a) for the purpose of determining the lawfulness of the distribution in accordance with this Part (whether before or after the distribution takes place), and

(b) for the purpose of the application of paragraphs 12(a) and[F583 34(3)(a)] of Schedule 4[F584 or paragraphs 12(a) and 34(3)(a) of Schedule 8] (only realised profits to be included in or transferred to the profit and loss account) in relation to anything done with a view to or in connection with the making of that distribution.

F583 1990 NI 5

F584 SR 1997/436

SupplementaryF1029 N.I.

Consequences of unlawful distribution N.I.

285.—(1) Where a distribution, or part of one, made by a company to one of its own members is made in contravention of this Part and, at the time of the distribution, he knows or has reasonable grounds for believing that it is so made, he is liable to repay it (or that part of it, as the case may be) to the company or (in the case of a distribution made otherwise than in cash) to pay the company a sum equal to the value of the distribution (or part) at that time.

(2) Paragraph (1) is without prejudice to any obligation imposed apart from this Article on a member of a company to repay a distribution unlawfully made to him; but this Article does not apply in relation to—

(a) financial assistance given by a company in contravention of Article 161, or

(b) any payment made by a company in respect of the redemption or purchase by the company of shares in itself.

(3) This Article is deemed to be included in Chapter VII of Part VI for the purposes of the Department's power to make regulations under Article 189.

Saving for provision in a company's articles operative before the Order of 1981 N.I.

286.  Where immediately before 1st July 1983 a company was authorised by a provision of its articles to apply its unrealised profits in paying up in full or in part unissued shares to be allotted to members of the company as fully or partly paid bonus shares, that provision continues (subject to any alteration of the articles) as authority for those profits to be so applied after that date.

[F585 Distributions by banking or insurance companies N.I.

287.   Where a company's accounts relevant for the purposes of this Part are prepared in accordance with the special provisions of Part VIII relating to banking or insurance companies, Articles 272 to 283 apply with the modifications shown in Schedule 11.]

F585 1990 NI 5, art. 25, Sch, 10 Pt. 1

Interpretation for Part IX N.I.

288.—(1) The following has effect for the interpretation of this Part.

(2) “Capitalisation”, in relation to a company's profits, means any of the following operations (whenever carried out)—

(a) applying the profits in wholly or partly paying up unissued shares in the company to be allotted to members of the company as fully or partly paid bonus shares, or

(b) transferring the profits to capital redemption reserve.

(3) References to profits and losses of any description are (respectively) to profits and losses of that description made at any time and, except where the context otherwise requires, are (respectively) to revenue and capital profits and revenue and capital losses.

Saving for other restraints on distribution N.I.

289.  The provisions of this Part are without prejudice to any statutory provision or rule of law, or any provision of a company's memorandum or articles, restricting the sums out of which, or the cases in which, a distribution may be made.

PART XF1029 N.I. A COMPANY'S MANAGEMENT; DIRECTORS AND SECRETARIES; THEIR QUALIFICATIONS, DUTIES AND RESPONSIBILITIES

Officers and registered officeF1029 N.I.

Directors N.I.

290.  F586 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F586 Art. 290 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Secretary N.I.

291.—(1) Every company shall have a secretary.

(2) A sole director shall not also be secretary.

(3) Anything required or authorised to be done by or to the secretary may, if the office is vacant or there is for any other reason no secretary capable of acting, be done by or to any assistant or deputy secretary or, if there is no assistant or deputy secretary capable of acting, by or to any officer of the company authorised generally or specially in that behalf by the directors.

(4) No company shall—

(a) have as secretary to the company a body corporate the sole director of which is the sole director of the company;

(b) have as sole director of the company a body corporate the sole director of which is secretary to the company.

Acts done by person in dual capacity N.I.

292.  A provision requiring or authorising a thing to be done by or to a director and the secretary is not satisfied by its being done by or to the same person acting both as director and as, or in place of, the secretary.

Validity of acts of directors N.I.

293.  F587 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F587 Art. 293 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 4(2))

Qualifications of company secretaries N.I.

294.—(1) It is the duty of the directors of a public company to take all reasonable steps to secure that the secretary (or each joint secretary) of the company is a person who appears to them to have the requisite knowledge and experience to dicharge the functions of secretary of the company and who—

(a) on 1st July 1983 held the office of secretary or assistant or deputy secretary of the company; or

(b) for at least 3 of the 5 years immediately preceding his appointment as secretary held the office of secretary of a company other than a private company; or

(c) is a member of any of the bodies specified in paragraph (2); or

(d) is a barrister, advocate or solicitor called or admitted in any part of the United Kingdom; or

(e) is a person who, by virtue of his holding or having held any other position or his being a member of any other body, appears to the directors to be capable of discharging those functions.

(2) The bodies referred to in paragraph (1)(c) are—

(a) the Institute of Chartered Accountants in Ireland;

(b) the Institute of Chartered Accountants in England and Wales;

(c) the Institute of Chartered Accountants of Scotland;

(d) the Chartered Association of Certified Accountants;

(e) the Institute of Chartered Secretaries and Administrators;

(f) the Institute of Cost and Management Accountants;

(g) the Chartered Institute of Public Finance and Accountancy.

[F588 Registered office N.I.

295 .F589 — (1) A company shall at all times have a registered office to which all communications and notices may be addressed.

(2) On incorporation the situation of the company's registered office is that specified in the statement sent to the registrar under Article 21.

(3) The company may change the situation of its registered office from time to time by giving notice in the prescribed form to the registrar.

(4) The change takes effect upon the notice being registered by the registrar, but until the end of the period of 14 days beginning with the date on which it is registered a person may validly serve any document on the company at its previous registered office.

(5) For the purposes of any duty of a company—

(a) to keep at its registered office, or make available for public inspection there, any register, index or other document, or

(b) to mention the address of its registered office in any document,

a company which has given notice to the registrar of a change in the situation of its registered office may act on the change as from such date, not more than 14 days after the notice is given, as it may determine.

(6) Where a company unavoidably ceases to perform at its registered office any such duty as is mentioned in paragraph (5)(a) in circumstances in which it was not practicable to give prior notice to the registrar of a change in the situation of its registered office, but—

(a) resumes performance of that duty at other premises as soon as practicable, and

(b) gives notice accordingly to the registrar of a change in the situation of its registered office within 14 days of doing so,

it shall not be treated as having failed to comply with that duty.

(7) In proceedings for an offence of failing to comply with any such duty as is mentioned in paragraph (5), it is for the person charged to show that by reason of the matters referred to in that paragraph or paragraph (6) no offence was committed.]

F588 1990 NI 10, art. 71

F589 mod. by SR 2004/307

Register of directors and secretaries N.I.

296 .F590 —F591 (1) Every company shall keep, at the same office as its register of members is kept, a register of its directors and secretaries; and the register shall, with respect to the particulars to be contained in it of those persons, comply with Articles 297 and 298.

(2) The company shall, within the period of 14 days from the occurrence of—

(a) any change among its directors or in its secretary, or

(b) any change in particulars contained in the register,

send to the registrar a notification in the prescribed form of the change and of the date on which it occurred; and a notification of a person having become a director or secretary, or one of joint secretaries, of the company shall contain a consent, signed by that person, to act in the relevant capacity.

(3) The register shallF592 . . . be open to the inspection of any member of the company without charge and of any other person on payment of[F592 such fee as may be prescribed].

(4) If an inspection required under this Article is refused, or if default is made in complying with paragraph (1) or (2), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(5) In the case of a refusal of inspection of the register, the court may by order compel an immediate inspection of it.

(6) For the purposes of this Article and Article 297, a shadow director of a company is deemed a director and officer of it.

F590 mod. by 2000 c. 38

F591 mod. by SR 2004/307

F592 1990 NI 10

Particulars of directors to be registered under Article 296 N.I.

297.—(1) Subject to the provisions of this Article, the register kept by a company under Article 296 shall contain the following particulars with respect to each director—

(a) in the case of an individual—

(i) his present[F593 name],

(ii) any former[F593 name],

(iii) his usual residential address,

(iv) his nationality,

(v) his business occupation (if any),

(vi) particulars of any other directorships held by him or which have been held by him, and

[F593 (vii) the date of his birth;]

(b) in the case of a corporation[F593 or Scottish firm], its corporate[F593 or firm] name and registered or principal office, and particulars of any other directorships held by it or which have been held by it.

[F593 (2) In paragraph (1)(a)—

(a) “name” means a person's Christian name (or other forename) and surname, except that in the case of a peer, or an individual usually known by a title, the title may be stated instead of his Christian name (or other forename) and surname, or in addition to either or both or them; and

(b) the reference to a former name does not include—

(i) in the case of a peer, or an individual normally known by a British title, the name by which he was known previous to the adoption of or succession to the title, or

(ii) in the case of any person, a former name which was changed or disused before he attained the age of 18 years or which has been changed or disused for 20 years or more, or

(iii) in the case of a married woman, the name by which she was known previous to the marriage.]

(3) It is not necessary for the register to contain on any day particulars of a directorship—

(a) which has not been held by a director at any time during the 5 years preceding that day,

(b) which is held by a director in a company which—

(i) is dormant or grouped with the company keeping the register, and

(ii) if he also held that directorship for any period during those 5 years, was for the whole of that period either dormant or so grouped,

(c) which was held by a director for any period during those 5 years in a company which for the whole of that period was either dormant or grouped with the company keeping the register.

(4) For the purposes of paragraph (3), “company” includes any body incorporated in Northern Ireland; and—

(a) [F594 Article 257AA(4)] applies as regards whether and when a company is or has been dormant, and

(b) a company is to be regarded as being or having been grouped with another at any time if at that time it is or was a company of which the other is or was a wholly-owned subsidiary, or if it is or was a wholly-owned subsidiary of the other or of another company of which that other is or was a wholly-owned subsidiary.

F593 1990 NI 10

F594 SR 2001/153

Particulars of secretaries to be registered under Article 296 N.I.

298.—(1) The register to be kept by a company under Article 296 shall contain the following particulars with respect to the secretary or, where there are joint secretaries, with respect to each of them—

(a) in the case of an individual, his present[F595 name], any former[F595 name] and his usual residential address, and

(b) in the case of a body corporate or a Scottish firm, its corporate or firm name and registered or principal office.

(2) Where all the partners in a firm are joint secretaries, the name and principal office of the firm may be stated instead of the particulars mentioned in paragraph (1).

[F595 (3) Article 297(2)(a) and (b) apply for the purposes of the obligation under paragraph (1)(a) of this Article to state the name or former name of an individual.]

F595 1990 NI 10

Provisions governing appointment of directorsF1029 N.I.

Share qualifications of directors N.I.

299.—(1) It is the duty of every director who is by the company's articles required to hold a specified share qualification, and who is not already qualified, to obtain his qualification within 2 months after his appointment, or such shorter time as may be fixed by the articles.

(2) For the purpose of any provision of the company's articles requiring a director to hold any specified share qualification, the bearer of a share warrant is not deemed the holder of the shares specified in the warrant.

(3) The office of director of a company is vacated if the director does not within 2 months from the date of his appointment (or within such shorter time as may be fixed by its articles) obtain his qualification, or if after the expiration of that period or shorter time he ceases at any time to hold his qualification.

(4) A person vacating office under this Article is incapable of being reappointed a director of the company until he has obtained his qualification.

(5) If after the expiration of that period or shorter time any unqualified person acts as a director of the company, he is liable to a fine and, for continued contravention, to a daily default fine.

Appointment of directors to be voted on individually N.I.

300.  F596 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F596 Art. 300 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Age limit for directors N.I.

301.  F597 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F597 Art. 301 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 4(2)(c) (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Duty of director to disclose his age N.I.

302.  F598 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F598 Art. 302 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 4(2)(c) (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Arts. 303‐310 rep. by 1989 NI 18

Removal of directorsF1029 N.I.

Resolution to remove director N.I.

311.  F599 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F599 Art. 311 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Director's right to protest removal N.I.

312.  F600 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F600 Art. 312 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 5(2))

Other provisions about directors and officersF1029 N.I.

Directors' names on company correspondence, etc. N.I.

313 .F601 —(1) A company to which this Article applies shall not state, in any form, the name of any its directors (otherwise than in the text or as a signatory) on any business letter on which the company's name appears unless it states on the letter in legible characters [F602 the name of every director of the company].

(2) This Article applies to—

(a) every company registered under this Order or under the former Companies Acts (except a company registered before 23rd November 1916); and

(b) every company incorporated outside Northern Ireland which has an established place of business within Northern Ireland unless it had established such a place of business before that date.

(3) If a company makes default in complying with this Article, every officer of the company who is in default is liable for each offence to a fine; and for this purpose, where a corporation is an officer of the company, any officer of the corporation is deemed an officer of the company.

[F602 (4) For the purposes of the obligation under paragraph (1) to state the name of every director of the company, a person's “name” means—

(a) in the case of an individual, his Christian name (or other forename) and surname; and

(b) in the case of a corporation or Scottish firm, its corporate or firm name.

(5) The initial or a recognised abbreviation of a person's Christian name or other forename may be stated instead of the full Christian name or other forename.

(6) In the case of a peer, or an individual usually known by a title, the title may be stated instead of his Christian name (or other forename) and surname or in addition to either or both of them.

(7) In this Article “director” includes a shadow director and the reference in paragraph (3) to an “officer” shall be construed accordingly.]

F601 mod. by 2000 c. 38

F602 1990 NI 10

Limited company may have directors with unlimited liability N.I.

314.—(1) In the case of a limited company, the liability of the directors or of the managing director may, if so provided by the memorandum, be unlimited.

(2) In the case of a limited company in which the liability of a director is unlimited, the directors of the company and the member who proposes any person for election or appointment to the office of director, shall add to that proposal a statement that the liability of the person holding that office will be unlimited.

(3) Before the person accepts the office or acts in it, notice in writing that his liability will be unlimited shall be given to him by the following or one of the following persons, namely—

(a) the promoters of the company,

(b) the directors of the company,

(c) the company secretary.

(4) If a director or proposer makes default in adding such a statement, or if a promoter, director or secretary makes default in giving the notice required by paragraph (3), then—

(a) he is liable to a fine, and

(b) he is also liable for any damage which the person so elected or appointed may sustain from the default;

but the liability of the person elected or appointed is not affected by the default.

Special resolution making liability of directors unlimited N.I.

315.—(1) A limited company, if so authorised by its articles, may by special resolution alter its memorandum so as to render unlimited the liability of its directors or of any managing director.

(2) When such a special resolution is passed, its provisions are as valid as if they had been originally contained in the memorandum.

Assignment of office by directors N.I.

316.  If provision is made by a company's articles, or by any agreement entered into between any person and the company, for empowering a director of the company to assign his office as such to another person, any assignment of office made in pursuance of that provision is (notwithstanding anything to the contrary contained in the provision) of no effect unless and until it is approved by a special resolution of the company.

Directors to have regard to interests of employees N.I.

317.  F603 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F603 Art. 317 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Provisions protecting directors from liability N.I.

317A.—(1) This Article applies in relation to any liability attaching to a director of a company in connection with any negligence, default, breach of duty or breach of trust by him in relation to the company.

(2) Any provision which purports to exempt (to any extent) a director of a company from any liability within paragraph (1) is void.

(3) Subject to paragraphs (4) and (5), any provision by which a company directly or indirectly provides (to any extent) an indemnity for a director of—

(a) the company, or

(b) an associated company,

against any liability within paragraph (1) is void.

(4) Paragraph (3) does not apply to a qualifying third party indemnity provision within the meaning of Article 317B(1).

(5) Paragraph (3) does not prevent a company from purchasing and maintaining for a director of—

(a) the company, or

(b) an associated company,

insurance against any liability within paragraph (1).

(6) In this Article—

“associated company”, in relation to a company (“C”), means a company which is C's subsidiary, or C's holding company or a subsidiary of C's holding company;

“provision” means a provision of any nature, whether or not it is contained in a company's articles or in any contract with a company.

Qualifying third party indemnity provisions N.I.

317B.—(1) For the purposes of Article 317A(4) a provision is a qualifying third party indemnity provision if it is a provision such as is mentioned in Article 317A(3) in relation to which conditions A to C are satisfied.

(2) Condition A is that the provision does not provide any indemnity against any liability incurred by the director—

(a) to the company, or

(b) to any associated company.

(3) Condition B is that the provision does not provide any indemnity against any liability incurred by the director to pay—

(a) a fine imposed in criminal proceedings, or

(b) a sum payable to a regulatory authority by way of a penalty in respect of non-compliance with any requirement of a regulatory nature (however arising).

(4) Condition C is that the provision does not provide any indemnity against any liability incurred by the director—

(a) in defending any criminal proceedings in which he is convicted, or

(b) in defending any civil proceedings brought by the company, or an associated company, in which judgment is given against him, or

(c) in connection with any application under any of the following provisions in which the court refuses to grant him relief, namely—

(i) Article 154(3) or (4), or

(ii) Article 675.

(5) In sub-paragraph (a), (b) or (c) of paragraph (4) the reference to any such conviction, judgment or refusal of relief is a reference to one that has become final.

(6) For the purposes of paragraph (5) a conviction, judgment or refusal of relief becomes final—

(a) if not appealed against, at the end of the period for bringing an appeal, or

(b) if appealed against, at the time when the appeal (or any further appeal) is disposed of.

(7) An appeal is disposed of—

(a) if it is determined and the period for bringing any further appeal has ended, or

(b) if it is abandoned or otherwise ceases to have effect.

(8) In this Article “associated company” and “provision” have the same meaning as in Article 317A.

Disclosure of qualifying third party indemnity provisions N.I.

317C.—(1) Paragraphs (2) and (3) impose disclosure requirements in relation to a directors' report under Article 242 in respect of a financial year.

(2) If —

(a) at the time when the report is approved under Article 242A, any qualifying third party indemnity provision (whether made by the company or otherwise) is in force for the benefit of one or more directors of the company, or

(b) at any time during the financial year, any such provision was in force for the benefit of one or more persons who were then directors of the company,

the report must state that any such provision is or (as the case may be) was so in force.

(3) If the company has made a qualifying third party indemnity provision and—

(a) at the time when the report is approved under Article 242A, any qualifying third party indemnity provision made by the company is in force for the benefit of one or more directors of an associated company, or

(b) at any time during the financial year, any such provision was in force for the benefit of one or more persons who were then directors of an associated company,

the report must state that any such provision is or (as the case may be) was so in force.

(4) Paragraph (5) applies where a company has made a qualifying third party indemnity provision for the benefit of a director of the company or of an associated company.

(5) Article 326 shall apply to—

(a) the company, and

(b) if the director is a director of an associated company, the associated company,

as if a copy of the provision, or (if it is not in writing) a memorandum setting out its terms, were included in the list of documents in Article 326(1).

(6) In this Article—

“associated company” and “provision” have the same meaning as in Article 317A; and

“qualifying third party indemnity provision” has the meaning given by Article 317B(1).

Provisions [F604 protecting] auditors from liability N.I.

318.— [F605 (1) This Article applies to any provision, whether contained in a company's articles or in any contract with the company or otherwise, for exemptingF606 . . . any person (whether an officer or not) employed by the company as auditor from, or indemnifying him against, any liability which by virtue of any rule of law would otherwise attach to him in respect of any negligence, default, breach of duty or breach of trust of which he may be guilty in relation to the company.

(2) Except as provided by paragraph (3) any such provision is void.

[F607 (3) This Article does not prevent a company—

(a) from purchasing and maintaining for any suchF608 . . . auditor insurance against any such liability, or

(b) from indemnifying any suchF609 . . . auditor against any liability incurred by him—

(i) in defending any proceedings (whether civil or criminal) in which judgment is given in his favour or he is acquitted, or

(ii) in connection with any application underF610 . . . Article 675 (general power to grant relief in case of honest and reasonable conduct) in which relief is granted to him by the court.]]

F604 Art. 318: words in heading substituted (6.4.2006) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 18(2); S.R. 2006/93, art. 2, Sch. (with art. 3)

F605 Art. 318 repealed (1.10.2007 for certain purposes and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 15(2))

F606 Words in art. 318(1) repealed (6.4.2006) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 18(2)(a), 24(2), Sch. 3; S.R. 2006/93, art. 2, Sch. (with art. 3)

F607 1990 NI 10

F608 Words in art. 318(3) repealed (6.4.2006) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 18(2)(b)(i), 24(2), Sch. 3; S.R. 2006/93, art. 2, Sch. (with art. 3)

F609 Words in art. 318(3) repealed (6.4.2006) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 18(2)(b)(i), 24(2), Sch. 3; S.R. 2006/93, art. 2, Sch. (with art. 3)

F610 Words in art. 318(3) repealed (6.4.2006) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 18(2)(b)(ii), 24(2), Sch. 3; S.R. 2006/93, art. 2, Sch. (with art. 3)

PART XIF1029 N.I. ENFORCEMENT OF FAIR DEALING BY DIRECTORS

Restrictions on directors taking financial advantageF1029 N.I.

Prohibition on tax-free payments to directors N.I.

319.  F611 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F611 Art. 319 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Payment to director for loss of office, etc. N.I.

320.  F612 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F612 Arts. 320-324 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 12(3))

Company approval for property transfer N.I.

321.  F613 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F613 Arts. 320-324 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 12(3))

Director's duty of disclosure on takeover, etc. N.I.

322.  F614 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F614 Arts. 320-324 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 12(3))

Consequences of non-compliance with Article 322 N.I.

323.  F615 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F615 Arts. 320-324 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, sch. 3 para. 12(3))

Provisions supplementing Articles 320 to 323 N.I.

324.  F616 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F616 Arts. 320-324 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 12(3))

Directors to disclose interest in contracts N.I.

325 .F617 —(1) It is the duty of a director of a company who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the company to declare the nature of his interest at a meeting of the directors of the company.

(2) In the case of a proposed contract, the declaration shall be made—

(a) at the meeting of the directors at which the question of entering into the contract is first taken into consideration; or

(b) if the director was not at the date of that meeting interested in the proposed contract, at the next meeting of the directors held after he become so interested;

and, in a case where the director becomes interested in a contract after it is made, the declaration shall be made at the first meeting of the directors held after he becomes so interested.

(3) For the purposes of this Article, a general notice given to the directors of a company by a director to the effect that—

(a) he is a member of a specified company or firm and is to be regarded as interested in any contract which may, after the date of the notice, be made with that company or firm; or

(b) he is to be regarded as interested in any contract which may after the date of the notice be made with a specified person who is connected with him (within the meaning of Article 354),

is deemed a sufficient declaration of interest in relation to any such contract.

(4) However, no such notice is of effect unless either it is given at a meeting of the directors or the director takes reasonable steps to secure that it is brought up and read at the next meeting of the directors after it is given.

(5) A reference in this Article to a contract includes any transaction or arrangement (whether or not constituting a contract) made or entered into on or after 1st July 1983.

(6) For the purposes of this Article, a transaction or arrangement of a kind described in [F618 section 197, 198, 200, 201 or 203 of the Companies Act 2006] (prohibition of loans, quasi-loans, etc. to directors) made by a company for a director of the company or a person connected with such a director is treated (if it would not otherwise be so treated, and whether or not it is prohibited by that Article) as a transaction or arrangement in which that director is interested.

(7) A director who fails to comply with this Article is liable to a fine.

(8) This Article applies to a shadow director as it applies to a director, except that a shadow director shall declare his interest, not at a meeting of directors, but by a notice in writing to the directors which is either—

(a) a specific notice given before the date of the meeting at which, if he had been a director, the declaration would be required by paragraph (2) to be made; or

(b) a notice which under paragraph (3) falls to be treated as a sufficient declaration of that interest (or would fall to be so treated apart from paragraph (4)).

(9) Nothing in this Article prejudices the operation of any rule of law restricting directors of a company from having an interest in contracts with the company.

F617 mod. by 2000 c. 38

F618 Words in art. 325(6) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 21 (with art. 12)

Directors' service contracts to be open to inspection N.I.

326.  F619 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F619 Arts. 326-330 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 6(4), 7(3), 13(4))

Director's contract of employment for more than 5 years N.I.

327.  F620 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F620 Arts. 326-330 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 6(4), 7(3), 13(4))

Substantial property transactions involving directors, etc. N.I.

328 .F621   F622 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F621 mod. by 2000 c. 38

F622 Arts. 326-330 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 6(4), 7(3), 13(4))

Exceptions from Article 328 N.I.

329.  F623 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F623 Arts. 326-330 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 6(4), 7(3), 13(4))

Liabilities arising from contravention of Article 328 N.I.

330.  F624 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F624 Arts. 326-330 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 6(4), 7(3), 13(4))

[F625 Invalidity of certain transactions involving directors, etc. N.I.

330A.— (1) This Article applies where a company enters into a transaction to which the parties include—

(a) a director of the company or of its holding company, or

(b) a person connected with such a director or a company with whom such a director is associated,

and the board of directors, in connection with the transaction, exceed any limitation on their powers under the company's constitution.

(2) The transaction is voidable at the instance of the company.

(3) Whether or not it is avoided, any such party to the transaction as is mentioned in paragraph (1)(a) or (b), and any director of the company who authorised the transaction, is liable—

(a) to account to the company for any gain which he has made directly or indirectly by the transaction, and

(b) to indemnify the company for any loss or damage resulting from the transaction.

(4) Nothing in the above provisions shall be construed as excluding the operation of any other statutory provision or rule of law by virtue of which the transaction may be called in question or any liability to the company may arise.

(5) The transaction ceases to be voidable if—

(a) restitution of any money or other asset which was the subject-matter of the transaction is no longer possible, or

(b) the company is indemnified for any loss or damage resulting from the transaction, or

(c) rights acquired bona fide for value and without actual notice of the directors' exceeding their powers by a person who is not party to the transaction would be affected by the avoidance, or

(d) the transaction is ratified by the company in general meeting, by ordinary or special resolution or otherwise as the case may require.

(6) A person other than a director of the company is not liable under paragraph (3) if he shows that at the time the transaction was entered into he did not know that the directors were exceeding their powers.

(7) This Article does not affect the operation of Article 45A in relation to any party to the transaction not within paragraph (1)(a) or (b).

But where a transaction is voidable by virtue of this Article and valid by virtue of that Article in favour of such a person, the court may, on the application of that person or of the company, make such order affirming, severing or setting aside the transaction, on such terms, as appear to the court to be just.

(8) In this Article “transaction” includes any act; and the reference in paragraph (1) to limitations under the company's constitution includes limitations deriving—

(a) from a resolution of the company in general meeting or a meeting of any class of shareholders, or

(b) from any agreement between the members of the company or of any class of shareholders.]

F625 1990 NI 10, art. 45(1)

Contracts with sole members who are directors N.I.

330B.  F626 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F626 Art. 330B repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 14(2))

Share dealings by directors and their familiesF1029 N.I.

Prohibition on directors dealing in share options N.I.

331.  F627 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F627 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Duty of director to disclose shareholdings in own company N.I.

332.  F628 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F628 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Register of directors' interests notified under Article 332 N.I.

333.  F629 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F629 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Sanctions for non-compliance N.I.

334.  F630 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F630 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Extension of Article 331 to spouses [F631 , civil partners] and children N.I.

335.  F632 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F631 2004 c.33

F632 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Extenstion of Article 332 to spouses [F633 , civil partners] and children N.I.

336.  F634 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F633 2004 c.33

F634 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Duty to notify stock exchange of matters notified under Articles 332 to 336 N.I.

337.  F635 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F635 Arts. 331-337 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Restrictions on a company's power to make loans, etc. to directors and persons connected with themF1029 N.I.

General restriction on loans, etc. to directors and persons connected with them N.I.

338.  F636 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F636 Art. 338 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Interpretation for Articles 338ff. N.I.

339.  F637 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F637 Art. 339 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Short-term quasi-loans N.I.

340.  F638 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F638 Art. 340 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Inter-company loans in the same group N.I.

341.  F639 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F639 Art. 341 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Loans of small amounts N.I.

342.  F640 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F640 Art. 342 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Minor and business transactions N.I.

343.  F641 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F641 Art. 343 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Transactions at behest of holding company N.I.

344.  F642 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F642 Art. 344 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Funding of director's expenditure on duty to company N.I.

345.  F643 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F643 Art. 345 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

[F644 Funding of director's expenditure on defending proceedings N.I.

345A.   F645 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

F644 Art. 345A inserted (6.4.2006) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 19; S.R. 2006/93, art. 2, Sch.

F645 Art. 345A repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Loan or quasi-loan by money-lending company N.I.

346.  F646 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F646 Art. 346 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

“Relevant amounts” for the purposes of Articles 342ff. N.I.

347.  F647 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F647 Art. 347 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

“Value” of transactions and arrangements N.I.

348.  F648 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F648 Art. 348 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Civil remedies for breach of Article 338 N.I.

349.  F649 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F649 Art. 349 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Criminal penalties for breach of Article 338 N.I.

350.  F650 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F650 Art. 350 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 8(3))

Record of transactions not disclosed in company accounts N.I.

351.  F651 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F651 Art. 351 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Exceptions from Article 351 N.I.

352.  F652 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F652 Art. 352 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

SupplementaryF1029 N.I.

Power to increase financial limits N.I.

353.  F653 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F653 Art. 353 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

“Connected persons”, etc. N.I.

354.  F654 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F654 Art. 354 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Transactions under foreign law N.I.

355.  F655 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F655 Art. 355 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

PART XIIF1029 N.I. COMPANY ADMINISTRATION AND PROCEDURE

CHAPTER IF1029 N.I. Company Identification

Company name to appear outside place of business N.I.

356 .F656 —(1) Every company shall paint or affix, and keep painted or affixed, its name on the outside of every office or place in which its business is carried on, in a conspicuous position and in letters easily legible.

(2) If a company does not paint or affix its name as required by paragraph (1), the company and every officer of it who is in default is liable to a fine; and if a company does not keep its name painted or affixed as so required, the company and every officer of it who is in default is liable to a fine, for continued contravention, to a daily default fine.

F656 mod. by SR 2004/307

Company's name to appear in its correspondence, etc. N.I.

357 .F657 —(1) Every company shall have its name mentioned in legible characters—

(a) in all business letters [F658 and order forms] of the company,

(b) in all its notices and other official publications,

[F659 (bb) on all its websites,]

(c) in all bills of exchange, promissory notes, endorsements, cheques and orders for money or goods purporting to be signed by or on behalf of the company, and

(d) in all its bills of parcels, invoices, receipts and letters of credit.

(2) If a company fails to comply with paragraph (1) it is liable to a fine.

(3) If an officer of a company or a person on its behalf—

(a) issues or authorises the issue of any business letter [F660 or order form] of the company or any notice or other official publication of the company, in which the company's name is not mentioned as required by paragraph (1), F661 . . .

[F662 (aa) causes or authorises the appearance of a website on which the company's name is not so mentioned, or]

(b) issues or authorises the issue of any bill of parcels, invoice, receipt or letter of credit of the company in which its name is not so mentioned,

he is liable to a fine.

(4) If an officer of a company or a person on its behalf signs or authorises to be signed on behalf of the company any bill of exchange, promissory note, endorsement, cheque or order for money or goods in which the company's name is not mentioned as required by paragraph (1), he is liable to a fine; and he is further personally liable to the holder of the bill of exchange, promissory note, cheque or order for money or goods for the amount of it (unless it is duly paid by the company).

[F663 (5) References in this Article to a document of any type are to a document of that type in hard copy, electronic or any other form.]

F657 mod. by SR 2004/307

F658 Words in art. 357(1)(a) inserted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 1(2)(a)

F659 Art. 357(1)(bb) inserted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 1(2)(b)

F660 Words in art. 357(3)(a) inserted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 1(3)(a)

F661 Word in art. 357(3)(a) omitted (1.1.2007) by virtue of Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 1(3)(b)

F662 Art. 357(3)(aa) inserted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 1(3)(c)

F663 Art. 357(5) inserted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 1(4)

Company seal N.I.

358 .F664 — [F665 (1) A company which has a common seal shall have its name engraved in legible characters on the seal; and if it fails to comply with this paragraph it is liable to a fine.]

(2) If an officer of a company or a person on its behalf uses or authorises the use of any seal purporting to be a seal of the company on which its name is not engraved as required by paragraph (1), he is liable to a fine.

F664 mod. by SR 2004/307

F665 1990 NI 10

Particulars in correspondence, etc. N.I.

359.—(1 )F666  Every company shall have the following particulars mentioned in legible characters in all business letters and order forms of the company [F667 , and on all the company's websites,] , namely—

(a) the company's place of registration and the number with which it is registered,

(b) the address of its registered office,

(c )F668 in the case of an investment company (as defined in Article 274), the fact that it is such a company, and

(d )F668 in the case of a limited company exempt from the obligation to use the word “limited” as part of its name [F669 under Article 40 or a community interest company which is not a public company], the fact that it is a limited company.

[F670 (2) If in the case of a company having a share capital there is a reference to the amount of share capital—

(a) on the stationery used for any such letters,

(b) on the company's order forms, or

(c) on any of the company's websites,

the reference must be to paid-up share capital.]

(3) As to contraventions of this Article, the following applies—

(a) if a company fails to comply with paragraph (1) or (2), it is liable to a fine, and

(b) if an officer of a company or a person on its behalf issues or authorises the issue of any business letter or order form not complying with those paragraphs, he is liable to a fine.

[F671 (ba) if an officer of a company or a person on its behalf causes or authorises the appearance of a website not complying with those paragraphs, he is liable to a fine.]

[F672 (6) References in this Article to a document of any type are to a document of that type in hard copy, electronic or any other form.]

F666 mod. by SR 1986/305

F667 Words in art. 359(1) inserted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 2(2)

F668 mod. by SR 2004/307

F669 Words in art. 359(1)(d) inserted (6.4.2007) by Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), arts. 1(3), 6(2), Sch. 4 para. 53 (with art. 11(1))

F670 Art. 359(2) substituted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 2(3)

F671 Art. 359: "In paragraph (5), after sub-paragraph (b)" there is inserted (1.1.2007) para. (ba) by virtue of Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 2(4)

F672 Art. 359: After reference to paragraph (5) there is inserted (1.1.2007) art. 359(6) by virtue of Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 2(5)

CHAPTER IIF1029 N.I. Register of Members

Obligation to keep and enter up register N.I.

360.—(1) Every company shall keep a register of its members and enter in it the particulars required by this Article.

(2) There shall be entered in the register—

(a) the names and addresses of the members;

(b) the date on which each person was registered as a member; and

(c) the date at which any person ceased to be a member.

(3) This paragraph applies in the case of a company having a share capital—

(a) with the names and addresses of the members there shall be entered a statement—

(i) of the shares held by each member, distinguishing each share by its number (so long as the share has a number) and, where the company has more than one class of issued shares, by its class, and

(ii) of the amount paid or agreed to be considered as paid on the shares of each member;

(b) where the company has converted any of its shares into stock and given notice of the conversion to the register, the register shall show the amount and class of stock held by each member, instead of the amount of shares and the particulars relating to shares specified in sub-paragraph (a).

[F673 (3A) Where a company purchases one or more of its own shares in circumstances in which Article 172A applies—

(a) the requirements of paragraphs (2) and (3) must be complied with unless the company cancels all of the shares forthwith after the purchase in accordance with Article 172D(1), but

(b) any share which is so cancelled must be disregarded for the purposes of paragraph (3).]

(4) In the case of a company which does not have a share capital but has more than one class of members, there shall be entered in the register, with the names and addresses of the members, the class to which each member belongs.

(5) If a company makes default in complying with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(6) An entry relating to a former member of a company may be removed from the register after the expiration of 20 years from the date on which he ceased to be a member.

(7) Liability incurred by a company from the making or deletion of an entry in its register of members or debenture holders, or from a failure to make or delete any such entry, is not enforceable more than 20 years after the date on which the entry was made or deleted or, in the case of any such failure, the failure first occurred.

This is without prejudice to any lesser period of limitation.

F673 SR 2004/275

[F674 Statement that company has only one member N.I.

360A.— (1) If the number of members of a private company limited by shares or by guarantee falls to one there shall upon the occurrence of that event be entered in the company's register of members with the name and address of the sole member—

(i) a statement that the company has only one member; and

(ii) the date on which the company became a company having only one member.

(2) If the membership of a private company limited by shares or by guarantee increases from one to two or more members there shall upon the occurrence of that event be entered in the company's register of members, with the name and address of the person who was formerly the sole member, a statement that the company has ceased to have only one member together with the date on which that event occurred.

(3) If a company makes default in complying with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.]

F674 SR 1992/405

Location of register N.I.

361.—(1) A company's register of members shall be kept at its registered office, except that—

(a) if the work of making it up is done at another office of the company, it may be kept there; and

(b) if the company arranges with some other person for the making up of the register to be undertaken on its behalf by that other, it may be kept at the office of the other at which the work is done;

but it must not be kept at a place outside Northern Ireland.

(2) Subject to paragraph (3), every company shall send notice in the prescribed form to the registrar of the place where its register of members is kept, and of any change in that place.

(3) The notice need not be sent if the register has, at all times since it came into existence (or, in the case of a register in existence on 1st April 1961, at all times since then) been kept at the company's registered office.

(4) If a company makes default for 14 days in complying with paragraph (2), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

Index of members N.I.

362.—(1) Every company having more than 50 members shall, unless the register of members is in such a form as to constitute in itself an index of the names of the members of the company and shall, within 14 days after the date on which any alteration is made in the register of members, make any necessary alteration in the index.

(2) The index shall in respect of each member contain a sufficient indication to enable the account of that member in the register to be readily found.

(3) The index shall be at all times kept at the same place as the register of members.

(4) If default is made in complying with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

Entries in register in relation to share warrants N.I.

363.—(1) On the issue of a share warrant the company shall strike out of its register of members the name of the member then entered therein as holding the shares specified in the warrant as if he had ceased to be a member, and shall enter in the register the following particulars, namely—

(a) the fact of the issue of the warrant;

(b) a statement of the shares included in the warrant, distinguishing each share by its number so long as the share has a number; and

(c) the date of the issue of the warrant.

(2) Subject to the company's articles, the bearer of a share warrant is entitled, on surrendering it for cancellation, to have his name entered as a member in the register of members.

(3) The company is responsible for any loss incurred by any person by reason of the company entering in the register the name of a bearer of a share warrant in respect of the shares therein specified without the warrant being surrendered and cancelled.

(4) Until the warrant is surrendered, the particulars specified in paragraph (1) are deemed to be those required by this Order to be entered in the register of members; and, on the surrender, the date of the surrender must be entered.

(5) Except as provided by Article 299(2) (director's share qualification), the bearer of a share warrant may, if the articles of the company so provide, be deemed a member of the company within the meaning of this Order, either to the full extent or for any purposes defined in its articles.

Inspection of register and index N.I.

364.  F675 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F675 Art. 364 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 2(2))

Non-compliance with Articles 361, 362 and 364; agent's default N.I.

365.  Where under Article 361(1)(b) the register of members is kept at the office of some person other than the company, and by reason of any default of his the company fails to comply with—

• Article 361(2) (notice to registrar),

• Article 362(3) (index to be kept with register), or

• F676 . . . ,

or with any requirement of this Order as to the production of the register, that other person is liable to the same penalties as if he were an officer of the company who was in default, F676 . . .

F676 Words in art. 365 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 2)

Power to close register N.I.

366.  A company may, on giving notice by advertisement in a newspaper circulating in the district in which the company's registered office is situated, close the register of members for any time or times not exceeding in the whole 30 days in each year.

Power of court to rectify register N.I.

367.—(1) If—

(a) the name of any person is, without sufficient cause, entered in or omitted from a company's register of members, or

(b) default is made or unnecessary delay takes place in entering on the register the fact of any person ceased to be a member,

the person aggrieved, or any member of the company, or the company, may apply to the court for rectification of the register.

(2) The court may either refuse the application or may order rectification of the register and payment by the company of any damages sustained by any party aggrieved.

(3) On such an application the court may decide any question relating to the title of a person who is a party to the application to have his name entered in or omitted from the register, whether the question arises between members or alleged members, or between members or alleged members on the one hand and the company on the other hand, and generally may decide any question necessary or expedient to be decided for rectification of the register.

(4) In the case of a company required by this Order to send a list of its members to the registrar, the court, when making an order for rectification of the register, shall by its order direct notice of the rectification to be given to the registrar.

Trusts not be entered on register N.I.

368.  No notice of any trust, expressed, implied or constructive, shall be entered on the register, or be receivable by the registrar.

Register to be evidence N.I.

369.  The register of members is prima facie evidence of any matters which are by this Order directed or authorised to be inserted in it.

External branch registers N.I.

370.—(1) A company having a share capital whose objects comprise the transaction of business in any of the countries or territories specified in Part I of Schedule 14 may cause to be kept in any such country or territory in which it transacts business a branch register of members resident in that country or territory.

(2) Such a branch register is to be known as an “external branch register”; and—

(a) any dominion register kept by a company under section 116 of the Act of 1960 is to become known as an external branch register of the company;

(b) where any statutory provision or instrument (including in particular a company's articles) refers to a company's dominion register, that reference is to be read (unless the context otherwise requires) as being to an external branch register kept under this Article; and

(c) references to a colonial register occurring in articles registered before 1st January 1933 are to be read as referring to an external branch register.

(3) Part II of Schedule 14 has effect with respect to external branch registers kept under this Article.

CHAPTER IIIF1029 N.I. ANNUAL RETURN

Duty to deliver annual returns N.I.

371 .F677 —(1) Every company shall deliver to the registrar successive annual returns each of which is made up to a date not later than the date which is from time to time the company's “return date”, that is—

(a) the anniversary of the company's incorporation, or

(b) if the company's last return delivered in accordance with this Chapter was made up to a different date, the anniversary of that date.

(2) Each return shall—

(a) be in the prescribed form,

(b) contain the information required by or under the following provisions of this Chapter, and

(c) be signed by a director or the secretary of the company;

and it shall be delivered to the registrar within 28 days after the date on which it is made up.

(3) If a company fails to deliver an annual return in accordance with this Chapter before the end of the period of 28 days after a return date, the company is guilty of an offence and liable to a fine and, in the case of continued contravention, to a daily default fine.

The contravention continues until such time as an annual return made up to that return date and complying with the requirements of paragraph (2) (except as to date of delivery) is delivered by the company to the registrar.

(4) Where a company is guilty of an offence under paragraph (3), every director or secretary of the company is similarly liable unless he shows that he took all reasonable steps to avoid the commission or continuation of the offence.

(5) The references in this Article to a return being delivered “in accordance with this Chapter” are—

(a) in relation to a return made after the coming into operation of Article 74 of the Companies (No. 2) (Northern Ireland) Order 1990, to a return with respect to which all the requirements of paragraph (2) are complied with;

(b) in relation to a return made before that time, to a return with respect to which the formal and substantive requirements of this Chapter as it then had effect were complied with, whether or not the return was delivered in time.

F677 mod. by SR 2004/307

Contents of annual return: general N.I.

372 .F678 —(1) Every annual return shall state the date to which it is made up and shall contain the following information—

(a) the address of the company's registered office;

(b) the type of company it is and its principal business activities;

(c) the name and address of the company secretary;

(d) the name and address of every director of the company;

(e) in the case of each individual director—

(i) his nationality, date of birth and business occupation, and

(ii) such particulars of other directorships and former names as are required to be contained in the company's register of directors;

(f) in the case of any corporate director, such particulars of other directorships as would be required to be contained in that register in the case of an individual;

(g) if the register of members is not kept at the company's registered office, the address of the place where it is kept;

(h) if any register of debenture holders (or a duplicate of any such register or a part of it) is not kept at the company's registered office, the address of the place where it is kept;

(i) if the company has elected—

(i) to dispense under Article 260 with the laying of accounts and reports before the company in general meeting, or

(ii) to dispense under Article 374A with the holding of annual general meetings,

a statement to that effect.

(2) The information as to the company's type shall be given by reference to the classification scheme prescribed for the purposes of this Article.

(3) The information as to the company's principal business activities may be given by reference to one or more categories of any prescribed system of classifying business activities.

(4) A person's “name” and “address” mean, respectively—

(a) in the case of an individual, his Christian name (or other forename) and surname and his usual residential address;

(b) in the case of a corporation or Scottish firm, its corporate or firm name and its registered or principal office.

(5) In the case of a peer, or an individual usually known by a title, the title may be stated instead of his Christian name (or other forename) and surname or in addition to either or both of them.

(6) Where all the partners in a firm are joint secretaries, the name and principal office of the firm may be stated instead of the names and addresses of the partners.

F678 mod. by SR 2004/307

Contents of annual return: particulars of share capital and shareholders N.I.

372A.—(1) The annual return of a company having a share capital shall contain the following information with respect to its share capital and members.

(2) The return shall state the total number of issued shares of the company at the date to which the return is made up and the aggregate nominal value of those shares.

(3) The return shall state with respect to each class of shares in the company—

(a) the nature of the class, and

(b) the total number and aggregate nominal value of issued shares of that class at the date to which the return is made up.

(4) The return shall contain a list of the names and addresses of every person who—

(a) is a member of the company on the date to which the return is made up, or

(b) has ceased to be a member of the company since the date to which the last return was made up (or, in the case of the first return, since the incorporation of the company);

and if the names are not arranged in alphabetical order the return shall have annexed to it an index sufficient to enable the name of any person in the list to be easily found.

(5) The return shall also state—

(a) the number of shares of each class held by each member of the company at the date to which the return is made up, and

(b) the number of shares of each class transferred since the date to which the last return was made up (or, in the case of the first return, since the incorporation of the company) by each member or person who has ceased to be a member, and the dates of registration of the transfers.

(6) The return may, if either of the two immediately preceding returns has given the full particulars required by paragraphs (4) and (5), give only such particulars as relate to persons ceasing to be or becoming members since the date of the last return and to shares transferred since that date.

(7) Paragraphs (4) and (5) do not require the inclusion of particulars entered in an external branch register if copies of those entries have not been received at the company's registered office by the date to which the return is made up.

Those particulars shall be included in the company's next annual return after they are received.

(8) Where the company has converted any of its shares into stock, the return shall give the corresponding information in relation to that stock, stating the amount of stock instead of the number or nominal value of shares.

Valid from 01/10/2008

Contents of annual return: information about shareholders: non-traded companies N.I.

372B.—(1) The annual return of a company that was a non-traded company throughout the return period shall also contain the following information.

(2) The return shall contain a list of the names of every person who was a member of the company at any time during the return period. If the names are not arranged in alphabetical order the return shall have annexed to it an index sufficient to enable the name of any person in the list to be easily found.

(3) The return shall also state—

(a) the number of shares of each class held at the end of the date to which the return is made up by each person who was a member of the company at that time,

(b) the number of shares of each class transferred during the return period by or to each person who was a member of the company at any time during that period, and

(c) the dates of registration of those transfers.

(4) If either of the two immediately preceding returns has given the full particulars required by paragraphs (2) and (3), the return need only give such particulars as relate—

(a) to persons who became, or ceased to be, members during the return period, and

(b) to shares transferred during that period.

(5) Paragraphs (2) and (3) do not require the inclusion of particulars entered in an overseas branch register if copies of those entries have not been received at the company's registered office by the date to which the return is made up. Those particulars shall be included in the company's next annual return after they are received.

Valid from 01/10/2008

Contents of annual return: information about shareholders: traded companies N.I.

372C.—(1) The annual return of a company that was a traded company at any time during the return period shall also contain the following information.

(2) The return shall contain a list of the names and addresses of every person who held at least 5% of the issued shares of any class of the company at any time during the return period. If the names are not arranged in alphabetical order the return shall have annexed to it an index sufficient to enable the name of any person in the list to be easily found.

(3) The return shall also state—

(a) the number of shares of each class held at the end of the date to which the return is made up by each person who held at least 5% of the issued shares of any class of the company at that time,

(b) the number of shares of each class transferred during the return period by or to each person who held at least 5% of the issued shares of any class of the company at any time during the return period, and

(c) the dates of registration of those transfers.

(4) If either of the two immediately preceding returns has given the full particulars required by paragraphs (2) and (3), the return need only give such particulars as relate—

(a) to persons who came to hold, or ceased to hold, at least 5% of the issued shares of any class of the company during the return period, and

(b) to shares transferred during that period.

(5) Paragraphs (2) and (3) do not require the inclusion of particulars entered in an overseas branch register if copies of those entries have not been received at the company's registered office by the date to which the return is made up. Those particulars shall be included in the company's next annual return after they are received.

Valid from 01/10/2008

Contents of annual return: information about shareholders: supplementary N.I.

372D.—(1) In Articles 372, 372B and 372C—

“non-traded company” means a company none of whose shares are shares admitted to trading on a regulated market (so that “traded company” means a company any of whose shares are shares admitted to trading on a regulated market);

“regulated market” means a market which appears on the list drawn up by an EEA State pursuant to Article 47 of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments; and

“return period”, in relation to an annual return, means the period beginning immediately after the date to which the last return was made up (or, in the case of the first return, with the incorporation of the company) and ending with the date to which the return is made up.

(2) Where a company has converted any of its shares into stock, the return shall give information in relation to that stock corresponding to that required by Article 372B or 372C (as the case may be) in relation to shares of the company, stating the amount of stock instead of the number of shares.

Supplementary provisions: regulations and interpretation N.I.

373.—(1) The Department may by regulations make further provision as to the information to be given in a company's annual return, which may amend or repeal the provisions of Articles 372 and 372A.

(2) For the purposes of this Chapter, except Article 371(2)(c) (signature of annual return), a shadow director shall be deemed to be a director.

CHAPTER IVF1029 N.I. Meetings and Resolutions

MeetingsF1029 N.I.

Annual general meeting N.I.

374.  F679 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F679 Art. 374 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 29(3), 35(1)(a))

Election by private company to dispense with annual general meetings N.I.

374A.  F680 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F680 Art. 374A repealed (20.1.2007 for art. 374A(3A)(6) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Department's power to call meeting in default N.I.

375.  F681 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F681 Art. 375 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Extraordinary general meeting on member's requisition N.I.

376.  F682 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F682 Art. 376 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 25(2))

Length of notice for calling meetings N.I.

377.  F683 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F683 Art. 377 repealed (20.1.2007 for art. 377(5)-(11) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

General provisions as to meetings and votes N.I.

378.  F684 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F684 Art. 378 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 22(2)(3), 26(2)(3), 30(2)(3))

Quorum at meetings of the sole member N.I.

378A.  F685 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F685 Art. 378A repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 30(2)(3))

Power of court to order meeting N.I.

379.  F686 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F686 Art. 379 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Proxies N.I.

380.  F687 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F687 Art. 380 repealed (20.1.2007 for certain purposes, otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5)

Right to demand a poll N.I.

381.  F688 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F688 Art. 381 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 30(2)(3))

Voting on a poll N.I.

382.  F689 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F689 Art. 382 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 30(2)(3))

Representation of bodies corporate at meetings N.I.

383.  F690 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F690 Art. 383 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 30(2)(3))

ResolutionsF1029 N.I.

Circulation of members' resolutions N.I.

384.  F691 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F691 Art. 384 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 29(2), 38(2))

In certain cases, compliance with Article 384 not required N.I.

385.  F692 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F692 Art. 385 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 29(2), 38(2))

Extraordinary and special resolutions N.I.

386.  F693 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F693 Art. 386 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 22(2)(3), 30(2)(3))

Resolution requiring special notice N.I.

387.  F694 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F694 Art. 387 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 27(2))

[F695 Elective resolution of private company N.I.

387A.— [F696 (1) An election by a private company for the purposes of—

(a) Article 90A (election as to duration of authority to allot shares),

(b) Article 260 (election to dispense with laying of accounts and reports before general meeting),

(c) Article 374A (election to dispense with holding of annual general meeting),

(d) Article 377(4) or 386(3) (election as to majority required to authorise short notice of meeting), or

(e) Article 394 (election to dispense with appointment of auditors annually),

shall be made by resolution of the company in general meeting in accordance with this Article.

Such a resolution is referred to in this Order as an “elective resolution”.

(2) An elective resolution is not effective unless—

(a) at least 21 days' notice in writing is given of the meeting, stating that an elective resolution is to be proposed and stating the terms of the resolution, and

(b) the resolution is agreed to at the meeting, in person or by proxy, by all the members entitled to attend and vote at the meeting.

[F697 (2A) An elective resolution is effective notwithstanding the fact that less than 21 days' notice in writing of the meeting is given if all the members entitled to attend and vote at the meeting so agree.]

[F698 (2B) For the purposes of this Article, notice in writing of the meeting is to be taken as given to a person where notice of the meeting is sent using electronic communications to such address as may for the time being be notified by that person to the company for that purpose.

(2C) For the purposes of this Article a notice in writing of the meeting is also to be treated as given to a person where—

(a) the company and that person have agreed that notices of meetings required to be given to that person may instead be accessed by him on a web site;

(b) the meeting is a meeting to which that agreement applies;

(c) that person is notified, in manner for the time being agreed between him and the company for the purpose, of—

(i) the publication of the notice on a web site;

(ii) the address of that web site; and

(iii) the place on that web site where the notice may be accessed, and how it may be accessed; and

(d) the notice continues to be published on that web site throughout the period beginning with the giving of that notification and ending with the conclusion of the meeting;

and for the purposes of this Article a notice treated in accordance with this paragraph as given to any person is to be treated as so given at the time of the notification mentioned in sub-paragraph (c).

(2D) A notification given for the purposes of paragraph (2C)(c) must—

(a) state that it concerns a notice of a company meeting at which an elective resolution is to be proposed, and

(b) specify the place, date and time of the meeting.

(2E) Nothing in paragraph (2C) shall invalidate the proceedings of a meeting where—

(a) any notice that is required to be published as mentioned in sub-paragraph (d) of that paragraph is published for a part, but not all, of the period mentioned in that sub-paragraph; and

(b) the failure to publish that notice throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the company to prevent or avoid.

(2F) In so far as the articles of the company do not provide for notices and notifications to be served using electronic communications, the provisions of Table A (as for the time being in operation) as to such service shall apply.]

(3) The company may revoke an elective resolution by passing an ordinary resolution to that effect.

(4) An elective resolution shall cease to have effect if the company is re-registered as a public company.

(5) An elective resolution may be passed or revoked in accordance with this Article, and the provisions referred to in[F698 paragraphs (1) and (2B) to (2E)] have effect, notwithstanding any contrary provision in the company's articles of association.

[F698 (6) In this article, “address” includes any number or address used for the purposes of electronic communications.]]]

F695 Art. 387A subst. by 1990 NI 10, art. 51

F696 Art. 387A repealed (20.1.2007 for art. 387A(2B)-(2F)(6), 1.10.2007 for art. 387A(1)(b)-(e) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(b), Sch. 3 Pt. 2 (with arts. 6, 8, Sch. 5); S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

F697 1997 NI 22

F698 SR 2003/3

Registration, etc. of resolutions and agreements N.I.

388.— [F699 (1) A copy of every resolution or agreement to which this Article applies shall, within 15 days after it is passed or made, be forwarded to the registrar and recorded by him; and it must be either a printed copy or else a copy in some other form approved by the registrar.

(2) Where a company's articles have been registered, a copy of [F700 every resolution or agreement to which Chapter 3 of Part 3 of the Companies Act 2006 applies (resolutions and agreements affecting a company's constitution) and which is] for the time being in force shall be embodied in or annexed to every copy of the articles issued after the passing of the resolution or the making of the agreement.

(3) Where a company's articles have not been registered, a printed copy of every such resolution or agreement shall be forwarded to any member at his request on payment of 5 pence or such less sum as the company may direct.

(4) This Article applies to—

(a) special resolutions;

(b) extraordinary resolutions;

[F701 (bb) an elective resolution or a resolution revoking such a resolution;]

(c) resolutions or agreements which have been agreed to by all the members of a company but which, if not so agreed to, would not have been effective for their purpose unless (as the case may be) they had been passed as special resolutions or as extraordinary resolutions;

(d) resolutions or agreements which have been agreed to by all the members of some class of shareholders but which, if not agreed to, would not have been effective for their purpose unless they had been passed by some particular majority or otherwise in some particular manner, and all resolutions or agreements which effectively bind all the members of any class of shareholders though not agreed to by all those members;

(e) a resolution passed by the directors of a company in compliance with a direction under Article 41(2) (change of name on Department's direction);

(f) a resolution of a company to give, vary, revoke or renew an authority to the directors for the purposes of Article 90 (allotment of relevant securities);

(g) a resolution of the directors passed under Article 157(2) (alteration of memorandum on company ceasing to be a public company, following acquisition of its own shares);

(h) a resolution conferring, varying[F702 , revoking or renewing] authority under Article 176 (market purchase of company's own shares);

(j) a resolution for voluntary winding up, passed under[F703 Article 70(1)(a) of the Insolvency Order]; and

(k) a resolution passed by the directors of an old public company, under Article 4(1) of the Consequential Provisions Order, that the company should be re-registered as a public company.

[F704 (l) a resolution of the directors passed by virtue of regulation 16(2) of the Uncertificated Securities Regulations 1995 (which allow title to a company's shares to be evidenced and transferred without written instrument); and

(m) a resolution of a company passed by virtue of regulation 16(6) of the Uncertificated Securities Regulations 1995 (which prevents or reverses a resolution of the directors under regulation 16(2) of those Regulations).]

[F705 (4A) For the purposes of this Article, references to a member of a company do not include the company itself where it is such a member by virtue only of its holding shares as treasury shares, and accordingly, in such circumstances, the company is not, for those purposes, to be treated as a member of any class of the company's shareholders.]

(5) If a company fails to comply with paragraph (1), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(6) If a company fails to comply with paragraph (2) or (3), the company and every officer of it who is in default is liable to a fine.

(7) For the purposes of paragraphs (5) and (6), a liquidator of a company is deemed an officer of it.]

F699 Art. 388 repealed (1.10.2007 for art. 388(4)(a)(c)-(m), 6.4.2008 for art. 388(4)(b) and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 1(2)) (as amended by S.I. 2007/2607, art. 4(3)(a)); S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2 (with arts. 7, 12)

F700 Words in art. 388(2) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 17(9) (with art. 12)

F701 1990 NI 5

F702 1989 NI 18

F703 1989 NI 19

F704 SI 1995/3272

F705 SR 2004/275

Resolution passed at adjourned meeting N.I.

389.  F706 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F706 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Written resolutions of private companiesF1029 N.I.

Written resolutions of private companies N.I.

389A.  F707 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F707 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Duty to notify auditors of proposed written resolution N.I.

389B.  F708 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F708 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Written resolutions: supplementary provisions N.I.

389C.  F709 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F709 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Records of proceedingsF1029 N.I.

Minutes of meetings N.I.

390.  F710 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F710 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Recording of written resolutions N.I.

390A.  F711 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F711 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Recording of decisions by the sole member N.I.

390B.  F712 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F712 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Inspection of minute books N.I.

391.  F713 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F713 Arts. 389-391 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 paras. 19(2), 24(2), 40(2))

Chapter VF1029 N.I. AUDITORS

Appointment of auditorsF1029 N.I.

Duty to appoint auditors N.I.

392.— [F714 (1) [F715 Every public company] shall appoint an auditor or auditors in accordance with this Chapter.

This is subject to Article 396A ([F716 certain companies exempt from obligation to appoint auditors).

(2 )F717  Auditors shall be appointed in accordance with Article 393 (appointment at general meeting at which accounts are laid). F718 . . .

(3 )F719  References in this Chapter to the end of the time for appointing auditors are to the end of the time within which an appointment must be made under Article 393(2). F720 . . .

(4) F721 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]]

F714 Art. 392 repealed (1.10.2007 for certain purposes and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

F715 Words in art. 392(1) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(1)(a) (with art. 12)

F716 SR 1995/128

F717 mod. by SR 2004/307

F718 Words in art. 392(2) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(1)(b) (with art. 12)

F719 mod. by SR 2004/307

F720 Words in art. 392(3) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(1)(c) (with art. 12)

F721 Art. 392(4) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(1)(d) (with art. 12)

Appointment at general meeting at which accounts laidF722 N.I.

393 .F723 — [F724 (1 )F725  This Article applies to every public company F726 . . . .

(2 )F727  The company shall, at each general meeting at which accounts are laid, appoint an auditor or auditors to hold office from the conclusion of that meeting until the conclusion of the next general meeting at which accounts are laid.

(3 )F728  The first auditors of the company may be appointed by the directors at any time before the first general meeting of the company at which accounts are laid; and auditors so appointed shall hold office until the conclusion of that meeting.

(4 )F729  If the directors fail to exercise their powers under paragraph (3), the powers may be exercised by the company in general meeting.]

F722 mod. by SR 2004/307

F723 mod. by SR 2004/307

F724 Art. 393 repealed (1.10.2007 for certain purposes and otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

F725 mod. by SR 2004/307

F726 Words in art. 393(1) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 20077 (S.I. 2007/2194), arts. 1(3), 10(1), {Sch. 4 para. 24(2)} (with art. 12)

F727 mod. by SR 2004/307

F728 mod. by SR 2004/307

F729 mod. by SR 2004/307

Appointment by private company which is not obliged to lay accounts N.I.

393A.  F730 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F730 Art. 393A repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

Election by private company to dispense with annual appointment N.I.

394.  F731 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F731 Art. 394 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

Appointment by Department in default of appointment by company N.I.

395.— [F732 (1 )F733  [F734 If in the case of a public company] no auditors are appointed, re-appointed or deemed to be re-appointed before the end of the time for appointing auditors, the Department may appoint a person to fill the vacancy.

(2 )F735  In such a case the company shall within one week of the end of the time for appointing auditors give notice to the Department of its power having become exercisable.

If a company fails to give the notice required by this Article, the company and every officer of it who is in default is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.]

F732 Art. 395 repealed (1.10.2007 for certain purposes otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

F733 mod. by SR 2004/307

F734 Words in art. 395(1) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(3) (with art. 12)

F735 mod. by SR 2004/307

Filling of casual vacancies N.I.

396.— [F736 (1 )F737  The directors [F738 of a public company], or the company in general meeting, may fill a casual vacancy in the office of auditor.

(2) While such a vacancy continues, any surviving or continuing auditor or auditors may continue to act.

(3 )F739  Special notice is required for a resolution at a general meeting of [F740 a public company]—

(a) filling a casual vacancy in the office of auditor, or

(b) re-appointing as auditor a retiring auditor who was appointed by the directors to fill a casual vacancy.

(4 )F741  On receipt of notice of such an intended resolution the company shall forthwith send a copy of it—

(a) to the person proposed to be appointed, and

(b) if the casual vacancy was caused by the resignation of an auditor, to the auditor who resigned.]

F736 Art. 396 repealed (1.10.2007 for certain purposes otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

F737 mod. by SR 2004/307

F738 Words in art. 396(1) inserted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(4)(a) (with art. 12)

F739 mod. by SR 2004/307

F740 Words in art. 396(3) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(4)(b) (with art. 12)

F741 mod. by SR 2004/307

[F742 Certain companies exempt from obligation to appoint auditors N.I.

396A.— [F743 (1) [F744 A public company] which by virtue of Article 257A (certain categories of small company) or[F745 Article 257AA (dormant companies) is exempt from the provisions of Part VIII relating to the audit of accounts is also exempt from the obligation to appoint auditors.

(2) The following provisions apply if [F746 a public company] which has been exempt from those provisions ceases to be so exempt.

(3 )F747  Where Article 393 applies (appointment at general meeting at which accounts are laid), the directors may appoint auditors at any time before the next meeting of the company at which accounts are to be laid; and auditors so appointed shall hold office until the conclusion of that meeting.

(4) F748 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5 )F749  If the directors fail to exercise their powers under paragraph (3) F750 . . . , the powers may be exercised by the company in general meeting.]]]

F742 SR 1995/128

F743 Art. 396A repealed (1.10.2007 for certain purposes otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 44(2))

F744 Words in art. 396A(1) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(5)(a) (with art. 12)

F745 SR 2001/153

F746 Words in art. 396A(2) substituted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(5)(b) (with art. 12)

F747 mod. by SR 2004/307

F748 Art. 396A(4) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(5)(c) (with art. 12)

F749 mod. by SR 2004/307

F750 Words in art. 396A(5) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 24(6) of the amending S.I.) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 24(5)(d) (with art. 12)

Art. 397 rep. by 1990 NI 5

Rights of auditorsF1029 N.I.

Rights to information N.I.

[F751 397A.— (1) An auditor of a company—

(a) has a right of access at all times to the company's books, accounts and vouchers (in whatever form they are held), and

(b) may require any of the persons mentioned in paragraph (2) to provide him with such information or explanations as he thinks necessary for the performance of his duties as auditor.

(2) Those persons are—

(a) any officer or employee of the company;

(b) any person holding or accountable for any of the company's books, accounts or vouchers;

(c) any subsidiary undertaking of the company which is a body corporate incorporated in Northern Ireland;

(d) any officer, employee or auditor of any such subsidiary undertaking or any person holding or accountable for any books, accounts or vouchers of any such subsidiary undertaking;

(e) any person who fell within any of sub-paragraphs (a) to (d) at a time to which the information or explanations required by the auditor relates or relate.

(3) Where a parent company has a subsidiary undertaking which is not a body corporate incorporated in Northern Ireland, the auditor of the parent company may require it to obtain from any of the persons mentioned in paragraph (4) such information or explanations as he may reasonably require for the purposes of his duties as auditor.

(4) Those persons are—

(a) the undertaking;

(b) any officer, employee or auditor of the undertaking;

(c) any person holding or accountable for any of the undertaking's books, accounts or vouchers;

(d) any person who fell within sub-paragraph (b) or (c) at a time to which the information or explanations relates or relate.

(5) If so required, the parent company must take all such steps as are reasonably open to it to obtain the information or explanations from the person within paragraph (4) from whom the auditor has required the company to obtain the information or explanations.

(6) A statement made by a person in response to a requirement under paragraph (1)(b) or (3) may not be used in evidence against him in any criminal proceedings except proceedings for an offence under Article 397B.

(7) Nothing in this Article or Article 397B compels any person to disclose information in respect of which in an action in the High Court a claim to legal professional privilege could be maintained.]

F751 Arts. 397A, 397B substituted (6.4.2007) for art. 397A by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 10; S.R. 2007/95, art. 2

Offences relating to the provision of information to auditors N.I.

397B.—(1) If a person knowingly or recklessly makes to an auditor of a company a statement (oral or written) that—

(a) conveys or purports to convey any information or explanations which the auditor requires, or is entitled to require, under Article 397A(1)(b), and

(b) is misleading, false or deceptive in a material particular,

the person is guilty of an offence and liable to imprisonment or a fine, or both.

(2) A person who fails to comply with a requirement under Article 397A(1)(b) without delay is guilty of an offence and is liable to a fine.

(3) However, it is a defence for a person charged with an offence under paragraph (2) to prove that it was not reasonably practicable for him to provide the required information or explanations.

(4) If a company fails to comply with Article 397A(5), the company and every officer of it who is in default is guilty of an offence and liable to a fine.

(5) Nothing in this Article affects any right of an auditor to apply for an injunction to enforce any of his rights under Article 397A.

Right to attend company meetings, &c. N.I.

398.—(1) A company's auditors are entitled—

(a )F752 to receive all notices of, and other communications relating to, any general meeting which a member of the company is entitled to receive;

(b )F753 to attend any general meeting of the company; and

(c )F754 to be heard at any general meeting which they attend on any part of the business of the meeting which concerns them as auditors.

[F755 (1A) F756 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2 )F757  In relation to a written resolution proposed to be agreed to by a private company F758 . . . , the company's auditors are entitled—

(a) to receive all such communications relating to the resolution as, by virtue of any provision of [F759 Chapter 2 of Part 13 of the Companies Act 2006], are required to be supplied to a member of the company,

Sub‐paras. (b)-(d) rep. by 1997 NI 22

(3) The right to attend or be heard at a meeting is exercisable in the case of a body corporate or partnership by an individual authorised by it in writing to act as its representative at the meeting.]

F752 mod. by SR 2004/307

F753 mod. by SR 2004/307

F754 mod. by SR 2004/307

F755 SR 2003/3

F756 Art. 398(1A) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 20(2) (with art. 12)

F757 mod. by SR 2004/307

F758 Words in art. 398(2) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 20(3)(a) (with art. 12)

F759 Words in art. 398(2)(a) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 20(3)(b) (with art. 12)

Remuneration of auditorsF1029 N.I.

Remuneration of auditors N.I.

398A.—(1 )F760  The remuneration of auditors appointed by the company in general meeting shall be fixed by the company in general meeting or in such manner as the company in general meeting may determine.

(2 )F761  The remuneration of auditors appointed by the directors or the Department shall be fixed by the directors or the Department, as the case may be.

F762 (3) There shall be stated in a note to the company's annual accounts the amount of the remuneration of the company's auditors in their capacity as such.

(4) For the purposes of this Article “remuneration” includes sums paid in respect of expenses.

(5) This Article applies in relation to benefits in kind as toF763 payments in cash, and in relation to any such benefit references to its amount are to its estimated money value.

The nature of any such benefit shall also be disclosed.

F760 mod. by SR 2004/307

F761 mod. by SR 2004/307

F762 prosp. rep. by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

F763 prosp. subst. by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

Remuneration of auditors or their associates for non-audit work N.I.

F764 398B .F765 —(1) The Department may make provision by regulations for securing the disclosure of the amount of any remuneration received or receivable by a company's auditors or their associates in respect of services other than those of auditors in their capacity as such.

(2) The regulations may—

(a) provide that “remuneration” includes sums paid in respect of expenses,

(b) apply in relation to benefits in kind as to payments in cash, and in relation to any such benefit require disclosure of its nature and its estimated money value,

(c) define “associate” in relation to an auditor,

(d) require the disclosure of remuneration in respect of services rendered to associated undertakings of the company, and

(e) define “associated undertaking” for that purpose.

(3) The regulations may require the auditors to disclose the relevant information in their report or require the relevant information to be disclosed in a note to the company's accounts and require the auditors to supply the directors of the company with such information as is necessary to enable that disclosure to be made.

F764 prosp. subst. by 2005 NI 17

F765 mod. by SR 2004/307

Removal, resignation, &c. of auditorsF1029 N.I.

Removal of auditors N.I.

399.—(1 )F766  A company may by ordinary resolution at any time remove an auditor from office, notwithstanding anything in any agreement between it and him.

(2 )F767  Where a resolution removing an auditor is passed at a general meeting of a company, the company shall within 14 days give notice of that fact in the prescribed form to the registrar.

If a company fails to give the notice required by this paragraph, the company and every officer of it who is in default is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(3) Nothing in this Article shall be taken as depriving a person removed under it of compensation or damages payable to him in respect of the termination of his appointment as auditor or of any appointment terminating with that as auditor.

(4 )F768  An auditor of a company who has been removed has, notwithstanding his removal, the rights conferred by Article 398 in relation to any general meeting of the company—

(a) at which his term of office would otherwise have expired, or

(b) at which it is proposed to fill the vacancy caused by his removal.

In such a case the references in that Article to matters concerning the auditors as auditors shall be construed as references to matters concerning him as a former auditor.

F766 mod. by SR 2004/307

F767 mod. by SR 2004/307

F768 mod. by SR 2004/307

Rights of auditors who are removed or not re-appointed N.I.

399A.—(1 )F769  Special notice is required for a resolution at a general meeting of a company—

(a) removing an auditor before the expiration of his term of office, or

(b) appointing as auditor a person other than a retiring auditor.

(2 )F770  On receipt of notice of such an intended resolution the company shall forthwith send a copy of it to the person proposed to be removed or, as the case may be, to the person proposed to be appointed and to the retiring auditor.

(3 )F771  The auditor proposed to be removed or (as the case may be) the retiring auditor may make with respect to the intended resolution representations in writing to the company (not exceeding a reasonable length) and request their notification to members of the company.

(4 )F772  The company shall (unless the representations are received by it too late for it to do so)—

(a )F773 in any notice of the resolution given to members of the company, state the fact of the representations having been made, and

(b )F774 send a copy of the representations to every member of the company to whom notice of the meeting is or has been sent.

(5 )F775  If a copy of any such representations is not sent out as required because received too late or because of the company's default, the auditor may (without prejudice to his right to be heard orally) require that the representations be read out at the meeting.

(6 )F776  Copies of the representations need not be sent out and the representations need not be read at the meeting if, on the application either of the company or of any other person claiming to be aggrieved, the court is satisfied that the rights conferred by this Article are being abused to secure needless publicity for defamatory matter; and the court may order the company's costs on the application to be paid in whole or in part by the auditor, notwithstanding that he is not a party to the application.

F769 mod. by SR 2004/307

F770 mod. by SR 2004/307

F771 mod. by SR 2004/307

F772 mod. by SR 2004/307

F773 mod. by SR 2004/307

F774 mod. by SR 2004/307

F775 mod. by SR 2004/307

F776 mod. by SR 2004/307

Resignation of auditors N.I.

400.—(1) An auditor of a company may resign his office by depositing a notice in writing to that effect at the company's registered office.

The notice is not effective unless it is accompanied by the statement required by Article 401A.

(2) An effective notice of resignation operates to bring the auditor's term of office to an end as of the date on which the notice is deposited or on such later date as may be specified in it.

(3 )F777  The company shall within 14 days of the deposit of a notice of resignation send a copy of the notice to the registrar.

If default is made in complying with this paragraph, the company and every officer of it who is in default is guilty of an offence and liable to a fine and, for continued contravention, a daily default fine.

F777 mod. by SR 2004/307

Rights of resigning auditors N.I.

400A.—(1) This Article applies where an auditor's notice of resignation is accompanied by a statement of circumstances which he considers should be brought to the attention of members or creditors of the company.

(2 )F778  He may deposit with the notice a signed requisition calling on the directors of the company forthwith duly to convene an extraordinary general meeting of the company for the purpose of receiving and considering such explanation of the circumstances connected with his resignation as he may wish to place before the meeting.

(3) He may request the company to circulate to its members—

(a )F779 before the meeting convened on his requisition, or

(b )F780 before any general meeting at which his term of office would otherwise have expired or at which it is proposed to fill the vacancy caused by his resignation,

a statement in writing (not exceeding a reasonable length) of the circumstances connected with his resignation.

(4) The company shall (unless the statement is received too late for it to comply)—

(a) in any notice of the meeting given to members of the company, state the fact of the statement having been made, and

(b) send a copy of the statement to every member of thecompany to whom notice of the meeting is or has been sent.

(5 )F781  If the directors do not within 21 days from the date of the deposit of a requisition under this Article proceed duly to convene a meeting for a day not more than 28 days after the date on which the notice convening the meeting is given, every director who failed to take all reasonable steps to secure that a meeting was convened as mentioned above is guilty of an offence and liable to a fine.

(6) If a copy of the statement mentioned above is not sent out as required because received too late or because of the company's default, the auditor may (without prejudice to his right to be heard orally) require that the statement be read out at the meeting.

(7) Copies of a statement need not be sent out and the statement need not be read out at the meeting if, on the application either of the company or of any other person who claims to be aggrieved, the court is satisfied that the rights conferred by this Article are being abused to secure needless publicity for defamatory matter; and the court may order the company's costs on such an application to be paid in whole or in part by the auditor, notwithstanding that he is not a party to the application.

(8 )F782  An auditor who has resigned has, notwithstanding his resignation, the rights conferred by Article 398 in relation to any such general meeting of the company as is mentioned in paragraph (3)(a) or (b).

In such a case the references in that Article to matters concerning the auditors as auditors shall be construed as references to matters concerning him as a former auditor.

F778 mod. by SR 2004/307

F779 mod. by SR 2004/307

F780 mod. by SR 2004/307

F781 mod. by SR 2004/307

F782 mod. by SR 2004/307

Termination of appointment of auditors not appointed annually N.I.

401.  F783 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F783 Art. 401 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Statement by person ceasing to hold office as auditor N.I.

401A .F784 —(1) Where an auditor ceases for any reason to hold office, he shall deposit at the company's registered office a statement of any circumstances connected with his ceasing to hold office which he considers should be brought to the attention of the members or creditors of the company or, if he considers that there are no such circumstances, a statement that there are none.

(2) In the case of resignation, the statement shall be deposited along with the notice of resignation; in the case of failure to seek re-appointment, the statement shall be deposited not less than 14 days before the end of the time allowed for next appointing auditors; in any other case, the statement shall be deposited not later than the end of the period of 14 days beginning with the date on which he ceases to hold office.

(3) If the statement is of circumstances which the auditor considers should be brought to the attention of the members or creditors of the company, the company shall within 14 days of the deposit of the statement either—

(a) send a copy of it to every person who under Article 246 is entitled to be sent copies of the accounts, or

(b) apply to the court.

(4) The company shall if it applies to the court notify the auditor of the application.

(5) Unless the auditor receives notice of such an application before the end of the period of 21 days beginning with the day on which he deposited the statement, he shall within a further seven days send a copy of the statement to the registrar.

(6) If the court is satisfied that the auditor is using the statement to secure needless publicity for defamatory matter—

(a) it shall direct that copies of the statement need not be sent out, and

(b) it may further order the company's costs on the application to be paid in whole or in part by the auditor, notwithstanding that he is not a party to the application;

and the company shall within 14 days of the court's decision send to the persons mentioned in paragraph (3)(a) a statement setting out the effect of the order.

(7) If the court is not so satisfied, the company shall within 14 days of the court's decision—

(a) send copies of the statement to the persons mentioned in paragraph (3)(a), and

(b) notify the auditor of the court's decision;

and the auditor shall within seven days of receiving such notice send a copy of the statement to the registrar.

F784 mod. by SR 2004/307

Offences of failing to comply with Article 401A N.I.

401B .F785 —(1) If a person ceasing to hold office as auditor fails to comply with Article 401A he is guilty of an offence and liable to a fine.

(2) In proceedings for an offence under paragraph (1) it is a defence for the person charged to show that he took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

(3) Articles 680A (liability of individuals for corporate default) and 680B (criminal proceedings against unincorporated bodies) apply to an offence under paragraph (1).

(4) If a company makes default in complying with Article 401A, the company and every officer of it who is in default is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

F785 mod. by SR 2004/307

F786 PART XIIIF1029 N.I. REGISTRATION OF CHARGES

F786 Pt. XIII (arts. 402-417J) substituted (prosp.) for arts. 402-417 by 1990 NI 10, arts. 28-40 (never in operation; amending provisions repealed 1.10.2009 by 2006 c. 46, Sch. 16)

Modifications etc. (not altering text)

C8 Pt. XIII excluded (21.2.2009) by Banking Act 2009 (c. 1), ss. 252(2)(b), 263(1) (with s. 247); S.I. 2009/296, art. 3, Sch. para. 11

Certain charges void if not registered N.I.

402 .F787 —(1) Subject to the provisions of this Part, a charge created by a company and being a charge to which this Article applies is, so far as any security on the company's property or undertaking is conferred by the charge, void against the liquidator [F788 or administrator] and any creditor of the company, unless the prescribed particulars of the charge together with the instrument (if any) by which the charge is created or evidenced, are delivered to or received by the registrar for registration in the manner required by this Part, within 21 days after the date of the charge's creation.

(2) Paragraph (1) is without prejudice to any contract or obligation for repayment of the money secured by the charge; and when a charge becomes void under this Article, the money secured by it immediately becomes payable.

F787 mod. by SR 2004/307

F788 1989 NI 19

Charges which have to be registered N.I.

403.—(1) Article 402 applies to the following charges—

(a) a charge for the purposes of securing any issue of debentures,

(b )F789 a charge on uncalled share capital of the company,

(c) a charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale,

(d) a charge on land (wherever situated) or any interest in it, but not including a charge for any rent or other periodical sum issuing out of land,

(e) a charge on book debts of the company,

(f) a floating charge on the company's undertaking or property,

(g )F789 a charge on calls made but not paid,

(h) a charge on a ship or aircraft, or any share in a ship,

(j) a charge on goodwill,[F790 or on any intellectual property].

(2) Where a negotiable instrument has been given to secure the payment of any book debts of a company, the deposit of the instrument for the purpose of securing an advance to the company is not, for the purposes of Article 402 and this Article, to be treated as a charge on those book debts.

(3) The holding of debentures entitling the holder to a charge on land is not for the purposes of this Article deemed to be an interest in land.

[F790 (3A) The following are “intellectual property” for the purposes of this Article—

F791 (a) any patent, trade mark,F792 . . . registered design, copyright or design right;

(b) any licence under or in respect of any such right.]

(4) In this Part, “charge” includes mortgage.

F789 mod. by SR 2004/307

F790 1988 c. 48

F791 mod. by 1994 c. 26

F792 1994 c. 26

Formalities of registration (debentures) N.I.

404.—(1) Where a series of debentures containing, or giving by reference to another instrument, any charge to the benefit of which the debenture holders of that series are entitled pari passu is created by a company, it is for the purposes of Article 402 sufficient if there are delivered to or received by the registrar, within 21 days after the execution of the deed containing the charge (or, if there is no such deed, after the execution of any debentures of the series), the following particulars in the prescribed form—

(a) the total amount secured by the whole series, and

(b )F793 the dates of the resolutions authorising the issue of the series and the date of the covering deed (if any) by which the security is created or defined, and

(c) a general description of the property charged, and

(d) the names of the trustees (if any) of the debenture holders,

together with the deed containing the charge or, if there is no such deed, one of the debentures of the series, so, however, that there shall be sent to the registrar for entry in the register particulars in the prescribed form of the date and amount of each issue of debentures of the series, but any omission to do this does not affect the validity of any of those debentures.

(2) Where any commission, allowance or discount has been paid or made either directly or indirectly by a company to a person in consideration of his—

(a) subscribing or agreeing to subscribe, whether absolutely or conditionally, for debentures of the company, or

(b) procuring or agreeing to procure subscriptions, whether absolute or conditional, for such debentures,

the particulars required to be sent for registration under Article 402 shall include particulars as to the amount or rate per cent. of the commission, discount or allowance so paid or made, but omission to do this does not affect the validity of the debentures issued.

(3) The deposit of debentures as security for a debt of the company is not, for the purposes of paragraph (2), treated as the issue of the debentures at a discount.

F793 mod. by SR 2004/307

Verification of charge on property outside Northern Ireland N.I.

405 .F794 —(1) In the case of a charge created out of the United Kingdom comprising property situated outside the United Kingdom, the delivery to and the receipt by the registrar of a copy (verified in the prescribed manner) of the instrument by which the charge is created or evidenced has the same effect for the purposes of Articles 402 to 404 and this Article as the delivery and receipt of the instrument itself.

(2) In that case, 21 days after the date on which the instrument or copy could, in due course of post (and if despatched with due diligence), have been received in Northern Ireland are substituted for the 21 days mentioned in Article 402(1) (or as the case may be, Article 404(1)) as the time within which the particulars and instrument or copy are to be delivered to the registrar.

(3) Where a charge is created in the United Kingdom but comprises property outside the United Kingdom, the instrument creating or purporting to create the charge may be sent for registration under Article 402 notwithstanding that further proceedings may be necessary to make the charge valid or effectual according to the law of the country in which the property is situated.

(4) Where a charge comprises property situated in Great Britain and registration in the country where the property is situated is necessary to make the charge valid or effectual according to the law of that country, the delivery to and the receipt by the registrar of a copy (verified in the prescribed manner) of the instrument by which the charge is created or evidenced, together with a certificate in the prescribed form stating that the charge was presented for registration in the country in which the property is situated on the date on which it was so presented has, for the purposes of Articles 402 to 404 and this Article, the same effect as the delivery and receipt of the instrument itself.

F794 mod. by SR 2004/307

Company's duty to notify registrar of charges it creates N.I.

406 .F795 —(1) It is a company's duty to send to the registrar for registration the particulars of every charge created by the company and of the issues of debentures of a series requiring registration under Articles 402 to 405; but registration of any such charge may be effected on the application of any person interested in it.

(2) Where registration is effected on the application of some person other than the company, that person is entitled to recover from the company the amount of any fees properly paid by him to the registrar on the registration.

(3) If a company fails to comply with paragraph (1), then, unless the registration has been effected on the application of some other person, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F795 mod. by SR 2004/307

Charges existing on property acquired N.I.

407 .F796 —(1) This Article applies where a company acquires property which is subject to a charge of any such kind as would, if it had been created by the company after the acquisition of the property, have been required to be registered under this part.

(2) The company shall cause the prescribed particulars of the charge, together with a copy (certified in the prescribed manner to be a correct copy) of the instrument (if any) by which the charge was created or is evidenced, to be delivered to the registrar for registration in the manner required by this Part within 21 days after the date on which the acquisition is completed.

(3) However, if the property is situated and the charge was created outside Northern Ireland, 21 days after the date on which the copy of the instrument could in due course of post, and if despatched with due diligence, have been received in Northern Ireland is substituted for the 21 days mentioned in paragraph (2) as the time within which the particulars and copy of the instrument are to be delivered to the registrar.

(4) If default is made in complying with this Article, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F796 mod. by SR 2004/307

Registration of orders charging land, etc. N.I.

408.—(1) Where—

(a) a charge imposed under Article 46 of the [1981 NI 6] Judgments Enforcement (Northern Ireland) Order 1981 or notice thereof is registered in the Land Registry against registered land or any estate in registered land of a company; or

(b) any such order is registered in the Registry of Deeds against any unregistered land or estate in land of a company;

the Registrar of Titles in the case of sub-paragraph (a) and the Registrar of Deeds in the case of sub-paragraph (b) shall as soon as may be cause 2 copies of the order made under Article 46 of that Order or of any notice registered under Article 48 of that order to be delivered to the registrar.

(2) The registrar shall on receipt of such copies—

(a) register one of them in accordance with the provisions of Article 409; and

(b) not later than 7 days from the date of such receipt, cause the other copy together with a certificate of registration under Article 409(3) to be sent to the company against which the judgment was given.

(3) Where any charge to which paragraph (1) applies is vacated, the Registrar of Titles or, as the case may be, the Registrar of Deeds shall cause a certified copy of the certificate of satisfaction lodged under Article 132(1) of the Judgments Enforcement (Northern Ireland) Order 1981 to be delivered to the registrar for entry of a memorandum of satisfaction pursuant to Article 411.

Register of charges to be kept by registrar N.I.

409 .F797 —(1) The registrar shall keep, with respect to each company, a register in the prescribed form of all the charges requiring registration under this Part.

(2) He shall enter in the register with respect to such charges the following particulars—

(a) in the case of a charge to the benefit of which the holders of a series of debentures are entitled, the particulars specified in Article 404(1);

(b) in the case of a charge imposed by the Enforcement of Judgments Office under Article 46 of the Judgments Enforcement (Northern Ireland) Order 1981, the date on which the charge became effective;

(c) in the case of any other charge—

(i) if it is a charge created by the company, the date of its creation, and if it is a charge which was existing on property acquired by the company, the date of the acquisition of the property, and

(ii) the amount secured by the charge, and

(iii) short particulars of the property charged, and

(iv) the persons entitled to the charge.

(3) The registrar shall give a certificate of the registration of any charge registered in pursuance of this Part, stating the amount secured by the charge.

The certificate—

(a)

shall be signed by the registrar, and

(b)

is conclusive evidence that the requirements of this Part as to registration have been satisfied.

(4) The register kept in pursuance of this Article shall be open to inspection by any person.

F797 mod. by SR 2004/307

Endorsement of certificate on debentures N.I.

410 .F798 —(1) The company shall cause a copy of every certificate of registration given under Article 409 to be endorsed on every debenture or certificate of debenture stock which is issued by the company and the payment of which is secured by the charge so registered.

(2) But this does not require a company to cause a certificate of registration of any charge so given to be endorsed on any debenture or certificate of debenture stock issued by the company before the charge was created.

(3) If a person knowingly and wilfully authorises or permits the delivery of a debenture or certificate of debenture stock which under this Article is required to have endorsed on it a copy of a certificate of registration without the copy being so endorsed upon it, he is liable (without prejudice to any other liability) to a fine.

F798 mod. by SR 2004/307

Entries of satisfaction and release N.I.

411.—(1)  [F799 Subject to paragraph (1A), the registrar], on receipt of a statutory declaration in the prescribed form verifying, with respect to a registered charge—

(a) that the debt for which the charge was created has been paid or satisfied in whole or in part, or

(b) that part of the property or undertaking charged has been released from the charge or has ceased to form part of the company's property or undertaking,

may enter on the register a memorandum of satisfaction in whole or in part, or of the fact that part of the property or undertaking has been released from the charge or has ceased to form part of the company's property or undertaking (as the case may be).

[F799 (1A )F800  The registrar may make any such entry as is mentioned in paragraph (1) where, instead of receiving such a statutory declaration as is mentioned in that paragraph, he receives a statement by a director, secretary, administrator or administrative receiver of the company which is contained in an electronic communication and that statement—

(a) verifies the matters set out in sub-paragraph (a) or (b) of that paragraph,

(b) contains a description of the charge,

(c) states the date of creation of the charge and the date of its registration under this Part,

(d) states the name and address of the chargee or, in the case of a debenture, trustee, and

(e) where sub-paragraph (b) of paragraph (1) applies, contains short particulars of the property or undertaking which has been released from the charge, or which has ceased to form part of the company's property or undertaking (as the case may be).]

(2) Where the registrar enters a memorandum of satisfaction in whole, he shall, if required, furnish the company with a copy of it.

[F799 (3) Any person who makes a false statement under paragraph (1A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

F799 SR 2003/3

F800 mod. by SR 2004/307

Rectification of register of charges N.I.

412.—(1 )F801  This Article applies if the court is satisfied that the omission to register a charge within the time required by this Part or that the omission or mis-statement of any particular with respect to any such charge or in a memorandum of satisfaction was accidental, or due to inadvertence or to some other sufficient cause, or is not of a nature to prejudice the position of creditors or shareholders of the company, or that on other grounds it is just and equitable to grant relief.

(2) The court may, on the application of the company or a person interested, and on such terms and conditions as seem to the court just and expedient, order that the time for registration shall be extended or, as the case may be, that the omission or mis-statement shall be rectified.

F801 mod. by SR 2004/307

Registration of enforcement of security N.I.

413 .F802 —(1) If a person obtains an order for the appointment of a receiver or manager of a company's property, or appoints such a receiver or manager under powers contained in an instrument, he shall within 7 days of the order or of the appointment under those powers, give notice of the fact to the registrar; and the registrar shall enter the fact in the register of charges.

(2) Where a person appointed receiver or manager of a company's property under powers contained in an instrument ceases to act as such receiver or manager, he shall, on so ceasing, give the registrar notice to that effect, and the registrar shall enter the fact in the register of charges.

(3) A notice under this Article shall be in the prescribed form.

(4) If a person makes default in complying with the requirements of this Article, he is liable to a fine and, for continued contravention, to a daily default fine.

F802 mod. by SR 2004/307

Companies to keep copies of instruments creating charges N.I.

414 .F803 —(1) Every company shall cause a copy of every instrument creating a charge requiring registration under this Part, including every order or notice a copy of which has been delivered to the company under Article 408, to be kept at the same office as its register of members is kept.

(2) In the case of a series of uniform debentures, a copy of one debenture of the series is sufficient.

F803 mod. by SR 2004/307

Company's register of charges N.I.

415.—(1 )F804  Every limited company shall keep at the same office as its register of members is kept a register of charges and enter in it all charges specifically affecting property of the company and all floating charges on the company's undertaking or any of its property.

(2) The entry shall in each case give a short description of the property charged, the amount of the charge and, except in the case of securities to bearer, the names of the persons entitled to the charge.

(3) If an officer of the company knowingly and wilfully authorises or permits the omission of any entry required to be made in pursuance of this Article, he is liable to a fine.

F804 mod. by SR 2004/307

Right to inspect instruments which create charges, etc. N.I.

416.—(1 )F805  The copies of instruments referred to in Article 414 and the register of charges kept in pursuance of Article 415, shall be open during business hours (subject to such reasonable restrictions as the company in general meeting may impose, but so that not less than 2 hours each day are allowed for inspection) to the inspection of any creditor or member of the company without fee.

(2) The register of charges shall also be open to the inspection of any other person on payment of such fee, not exceeding 5 pence for each inspection, as the company may determine.

(3) If inspection of the copies referred to, or of the register, is refused, every officer of the company who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(4) If such a refusal occurs the court may by order compel an immediate inspection of the copies or register.

F805 mod. by SR 2004/307

Application of this Part to companies incorporated outside Northern Ireland N.I.

417.—(1) This Part extends to charges on property in Northern Ireland which are created, and to charges on property in Northern Ireland which is acquired, by a company (whether a company within the meaning of this Order or not) incorporated outside Northern Ireland which has an established place of business in Northern Ireland.

(2) In relation to such a company, Articles 414 and 415 apply with the substitution, for the reference to the office at which the register of members is kept, of a reference to the company's principal place of business in Northern Ireland.

PART XIVF1029 N.I. ARRANGEMENTS AND RECONSTRUCTIONS

Power of company to compromise with creditors and members N.I.

418.—(1) Where a compromise or arrangement is proposed between a company and its creditors, or any class of them, or between the company and its members, or any class of them, the court may on the application of the company or any creditor or member of it or, in the case of a company being wound up [F806 or[F807 in administration], of the liquidator or administrator], order a meeting of the creditors or class of creditors, or of the members of the company or class of members (as the case may be), to be summoned in such manner as the court directs.

(2) If a majority in number representing three-fourths in value of the creditors or class of creditors or members or class of members (as the case may be), present and voting either in person or by proxy at the meeting, agree to any compromise or arrangement, the compromise or arrangement, if sanctioned by the court, is binding on all the creditors or the class of creditors, or on the members or class of members (as the case may be), and also on the company or, in the case of a company in the course of being wound up, on the liquidator and contributories of the company.

(3 )F808  The court's order under paragraph (2) has no effect until an office copy of it has been delivered to the registrar for registration; and a copy of every such order shall be annexed to every copy of the company's memorandum issued after the order has been made or, in the case of a company not having a memorandum, of every copy so issued of the instrument constituting the company or defining its constitution.

(4) If a company makes default in complying with paragraph (3), the company and every officer of it who is in default is liable to a fine.

(5 )F808  In this Article and Article 419—

(a) “company” means any company liable to be wound up under this Order [F809 or which would be so liable but for Article 43 of the Water and Sewerage Services (Northern Ireland) Order 2006], and

(b) “arrangement” includes a reorganisation of the company's share capital by the consolidation of shares of different classes or by the division of shares into shares of different classes, or by both of those methods.

F806 1989 NI 19

F807 Words in art. 418(1) substituted (27.3.2006) by Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)), arts. 1(3), 3(3), Sch. 2 para. 14; S.R. 2006/21, art. 2 (with S.R. 2006/22, arts. 2-7)

F808 mod. by SR 2004/307

F809 Words in art. 418(5)(a) inserted (1.4.2007) by Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336 (N.I. 21)), arts. 1(2), 308(1), Sch. 12 para. 24 (with arts. 8(8), 121(3), 307); S.R. 2007/194, art. 2(2), Sch. 1 Pt. II (subject to art. 3, Sch. 2)

Information as to compromise to be circulated N.I.

419.—(1) This Article applies where a meeting of creditors or any class of creditors, or of members or any class of members, is summoned under Article 418.

(2 )F810  With every notice summoning the meeting which is sent to a creditor or member there shall be sent also a statement explaining the effect of the compromise or arrangement and in particular state any material interests of the directors of the company (whether as directors or as members or as creditors of the company or otherwise) and the effect on those interests of the compromise or arrangement, in so far as it is different from the effect on the like interests of other persons.

(3) In every notice summoning the meeting which is given by advertisement there shall be included either such a statement as is mentioned in paragraph (2) or a notification of the place at which, and the manner in which, creditors or members entitled to attend the meeting may obtain copies of the statement.

(4) Where the compromise or arrangement affects the rights of debenture holders of the company, the statement shall give the like explanation as respects the trustees of any deed for securing the issue of the debentures as it is required to give as respects the company's directors.

(5) Where a notice given by advertisement includes a notification that copies of a statement explaining the effect of the compromise or arrangement proposed can be obtained by creditors or members entitled to attend the meeting, every such creditor or member shall, on making application in the manner indicated by the notice, be furnished by the company free of charge with a copy of the statement.

(6) If a company makes default in complying with any requirement of this Article, the company and every officer of it who is in default is liable to a fine; and for this purpose a liquidator[F811 or administrator] of the company and a trustee of a deed for securing the issue of debentures of the company is deemed an officer of it.

However, a person is not liable under this paragraph if he shows that the default was due to the refusal of another person, being a director or trustee for debenture holders, to supply the necessary particulars of his interests.

(7) It is the duty of any director of the company, and of any trustee for its debenture holders, to give notice to the company of such matters relating to himself as may be necessary for the purposes of this Article; and any person who makes default in complying with this paragraph is liable to a fine.

F810 mod. by SR 2004/307

F811 1989 NI 19

Provisions for facilitating company reconstruction or amalgamation N.I.

420.—(1) This Article applies where application is made to the court under Article 418 for the sanctioning of a compromise or arrangement proposed between a company and any such persons as are mentioned in that Article.

(2) If it is shown—

(a) that the compromise or arrangement has been proposed for the purposes of, or in connection with, a scheme for the reconstruction of any company or companies, or the amalgamation of any two or more companies, and

(b) that under the scheme the whole or any part of the undertaking or the property of any company concerned in the scheme ( “a transferor company”) is to be transferred to another company ( “the transferee company”),

the court may, either by the order sanctioning the compromise or arrangement or by any subsequent order, make provision for all or any of the following matters.

(3) The matters for which the court's order may make provision are—

(a) the transfer to the transferee company or the whole or any part of the undertaking and of the property or liabilities of any transferor company,

(b )F812 the allotting or appropriation by the transferee company of any shares, debentures, policies or other like interests in that company which under the compromise or arrangement are to be allotted or appropriated by that company to or for any person,

(c) the continuation by or against the transferee company of any legal proceedings pending by or against any transferor company,

(d) the dissolution, without winding up, of any transferor company,

(e) the provision to be made for any persons who, within such time and in such manner as the court directs, dissent from the compromise or arrangement,

(f) such incidental, consequential and supplemental matters as are necessary to secure that the reconstruction or amalgamation is fully and effectively carried out.

(4) If an order under this Article provides for the transfer of property or liabilities, then—

(a) that property is by virtue of the order transferred to, and vests in, the transferee company, and

(b) those liabilities are, by virtue of the order, transferred to and become liabilities of that company;

and property (if the order so directs) vests freed from any charge which is by virtue of the compromise or arrangement to cease to have effect.

(5) Where an order is made under this Article, every company in relation to which the order is made shall cause an office copy of the order to be delivered to the registrar for registration within 7 days after its making; and if default is made in complying with this paragraph, the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

(6 )F812  In this Article “property” includes property, rights and powers of every description; “liabilities” includes duties and “company” includes only a company as defined in Article 3(1).

F812 mod. by SR 2004/307

[F813 Application of Articles 418 to 420 mergers and divisions of public companies N.I.

420A.— (1) Where—

(a) a compromise or arrangement is proposed between a public company and any such persons as are mentioned in Article 418(1) for the purposes of, or in connection with, a scheme for the reconstruction of any company or companies or the amalgation of any two or more companies,

(b) the circumstances are as specified in any of the Cases described in paragraph (2), and

(c) the consideration for the transfer or each of the transfers envisaged in the Case in question is to be shares in the transferee company or any of the transferee companies receivable by members of the transferor company or transferor companies, with or without any cash payment to members,

Articles 418 to 420 shall, as regards that compromise or arrangement, have effect subject to the provisions of this Article and Schedule[F814 15B].

(2) The cases referred to in paragraph (1) are as follows—

Case 1

Where under the scheme the undertaking, property and liabilities of the company in respect of which the compromise or arrangement in question is proposed are to be transferred to another public company, other than one formed for the purpose of, or in connection with, the scheme.

Case 2

Where under the scheme the undertaking, property and liabilities of each of two or more public companies concerned in the scheme, including the company in respect of which the compromise or arrangement in question is proposed, are to be transferred to a company (whether or not a public company) formed for the purpose of, or in connection with, the scheme.

Case 3

Where under the scheme the undertaking, property and liabilities of the company in respect of which the compromise or arrangement in question is proposed are to be divided among and transferred to two or more companies each of which is either—

(a) a public company, or

(b) a company (whether or not a public company) formed for the purposes of, or in connection with, the scheme.

(3) Before sanctioning any compromise or arrangement under Article 418(2) the court may, on the application of any pre-existing transferee company or any member or creditor of it or,[F815 where the company is in administration], the administrator, order a meeting of the members of the company or any class of them or of the creditors of the company or any class of them to be summoned in such manner as the court directs.

(4) This Article does not apply where the company in respect of which the compromise or arrangement is proposed is being wound-up.

(5) This Article does not apply to compromises or arrangements in respect of which an application has been made to the court for an order under Article 418(1) before 1st January 1988.

(6) Where Article 420 would apply in the case of a scheme but for the fact that the transferee company or any of the transferee companies is a company within the meaning of section 735(1) of the Companies Act 1985 (and thus not within the definition of “company” in Article 420(6)), Article 420 shall apply notwithstanding that fact.

(7) In the case of a scheme mentioned in paragraph (1), for a company within the meaning of section 735(1) of the Companies Act 1985, the reference in Article 420(5) to the registrar shall have effect as a reference to the registrar of companies as defined in section 744 of that Act.

(8) In this Article and Schedule[F814 15B]

“transferor company” means a company whose undertaking, property and liabilities are to be transferred by means of a transferor envisaged in any of the Cases specified in paragraph (2);

“transferee company” means a company to which a transfer envisaged in any of those Cases is to be made;

“pre-existing transferee company” means a transferee company other than one formed for the purpose of, or in connection with, the scheme;

“compromise or arrangement” means a compromise or arrangement to which paragraph (1) applies;

“the scheme” means the scheme mentioned in paragraph (1)(a);

“company” includes only a company as defined in Article 3(1) except that, in the case of a transferee company, it also includes a company as defined in section 735(1) of the Companies Act 1985 (referred to in these definitions as a “Great Britain company”);

“public company” means, in relation to a transferee company which is a Great Britain company, a public company within the meaning of section 1(3) of the Companies Act 1985;

“registrar” means, in relation to a transferee company which is a Great Britain company, the registrar of companies as defined in section 744 of the Companies Act 1985;

“the Gazette” means the Belfast Gazette or, in relation to a transferee comapny which is a Great Britain company, the Gazette as defined in section 744 of the Companies Act 1985;

“Case 1 Scheme”, “Case 2 Scheme” and “Case 3 Scheme” mean a scheme of the kind described in Cases 1, 2 and 3 of paragraph (2) respectively;

“property” and “liabilities” have the same meaning as in Article 420;

“administrator” means a person appointed as defined in section 8(2) of the Insolvency Act 1986; and

“administration order” means an order of the court under section 8 of that Act.]

F813 Art. 420A inserted SR 1987/442,

F814 1990 NI 10

F815 Words in art. 420A(3) substituted (27.3.2006) by Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)), arts. 1(3), 3(3), Sch. 2 para. 15; S.R. 2006/21, art. 2 (with S.R. 2006/22, arts. 2-7)

PART XIVAF1029 N.I. TAKEOVER OFFERS

Takeover offers N.I.

421.  F816 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F816 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Right of offeror to buy out minority shareholders N.I.

422.  F817 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F817 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Effect of notice under Article 422 N.I.

423.  F818 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F818 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Right of minority shareholder to be bought out by offeror N.I.

423A.  F819 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F819 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Effect of requirement under Article 423A N.I.

423B.  F820 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F820 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Applications to the court N.I.

423C.  F821 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F821 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Joint offers N.I.

423D.  F822 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F822 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Associates N.I.

423E.  F823 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F823 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

Convertible securities N.I.

423F.  F824 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F824 Arts. 421-423F repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/1093, art. 5, Sch. 2 Pt. 2 (with arts. 8, 11(1), Sch. 6 para. 1)

PART XVF1029 N.I. INVESTIGATION OF COMPANIES AND THEIR AFFAIRS; REQUISITION OF DOCUMENTS

Appointment and functions of inspectorsF1029 N.I.

Investigation of a company on its own application or that of its members N.I.

424.—(1) The Department may appoint one or more competent inspectors to investigate the affairs of a company and to report on them to the Department in such manner as the Department may direct.

(2 )F825  The appointment may be made—

(a) in the case of a company having a share capital, on the application either of not less than 200 members or of members holding not less than one-tenth of the shares issued[F826 (excluding any shares held as treasury shares)];

(b) in the case of a company not having a share capital, on the application of not less than one-fifth in number of the persons on the company's register of members, and

(c) in any case, on application of the company.

(3) The application shall be supported by such evidence as the Department may require for the purpose of showing that the applicant or applicants have good reason for requiring the investigation.

(4) The Department may, before appointing inspectors, require the applicant or applicants to give security, to an amount not exceeding £5,000, or such other sum as it may by order, subject to negative resolution, specify, for payment of the costs of the investigation.

F825 mod. by SR 2004/307

F826 SR 2004/275

Other company investigations N.I.

425.—(1) The Department shall appoint one or more competent inspectors to investigate the affairs of a company and report on them in such manner as the Department directs, if the court by order declares that the company's affairs ought to be so investigated.

(2) The Department may make such an appointment if it appears to the Department that there are circumstances suggesting—

(a) that the company's affairs are being or have been conducted with intent to defraud its creditors or the creditors of any other person or otherwise for a fraudulent or unlawful purpose, or in a manner which is unfairly prejudicial to some part of its members, or

(b) that any actual or proposed act or omission of the company (including an act or omission on its behalf) is or would be so prejudicial, or that the company was formed for any fraudulent or unlawful purpose, or

(c) that persons concerned with the company's formation or the management of its affairs have in connection therewith been guilty of fraud, misfeasance or other misconduct towards it or towards its members, or

(d) that the company's members have not been given all the information with respect to its affairs which they might reasonably expect.

[F827 (2A) Inspectors may be appointed under paragraph (2) on terms that any report they may make is not for publication; and in such a case, the provisions of Article 430(3) (availability and publication of inspectors' reports) do not apply.]

(3) Paragraphs (1) and (2) are without prejudice to the powers of the Department under Article 424; and the power conferred by paragraph (2) is exercisable with respect to a body corporate notwithstanding that it is in course of being voluntarily wound up.

(4 )F828  The reference in paragraph (2)(a) to a company's members includes any person who is not a member but to whom shares in the company have been transferred or transmitted by operation of law.

F827 1990 NI 10

F828 mod. by SR 2004/307

Inspectors' powers during investigation N.I.

426 .F829 —(1) If inspectors appointed under Article 424 or 425 to investigate the affairs of a company think it necessary for the purposes of their investigation to investigate also the affairs of another body corporate which is or at any relevant time has been the company's subsidiary or holding company, or a subsidiary of its holding company or a holding company of its subsidiary, they have power to do so; and they shall report on the affairs of the other body corporate so far as they think that the results of their investigation of its affairs are relevant to the investigation of the affairs of the company first mentioned.

Para. (2) rep. by 1986 c. 60

F829 mod. by SR 2004/307

Production of documents and evidence to inspectors N.I.

427 .F830 —(1) When inspectors are appointed under Article 424 or 425, it is the duty of all officers and agents of the company, and of all officers and agents of any other body corporate whose affairs are investigated under Article 426(1)—

(a) to produce to the inspectors all[F831 documents] of or relating to the company or, as the case may be, the other body corporate which are in their custody or power,

(b) to attend before the inspectors when required to do so, and

(c) otherwise to give the inspectors all assistance in connection with the investigation which they are reasonably able to give.

[F831 (2) If the inspectors consider that an officer or agent of the company or other body corporate, or any other person, is or may be in possession of information relating to a matter which they believe to be relevant to the investigation, they may require him—

(a) to produce to them any documents in his custody or power relating to that matter,

(b) to attend before them, and

(c) otherwise to give them all assistance in connection with the investigation which he is reasonably able to give;

and it is that person's duty to comply with the requirement.]

[F831 (3) An inspector may for the purposes of the investigation examine any person on oath, and may administer an oath accordingly.]

(4) In this Article, a reference to officers or to agents includes past as well as present, officers or agents (as the case may be); and “agents”, in relation to a company or other body corporate, includes its bankers and solicitors and persons employed by it as auditors, whether those persons are or are not officers of the company or other body corporate.

(5) An answer given by a person to a question put to him in exercise of powers conferred by this Article (whether as it has effect in relation to an investigation under any of Articles 424 to 426, or as applied by any other Article in this Part) may be used in evidence against him.

[F832 (5A) However, in criminal proceedings in which that person is charged with an offence to which this paragraph applies—

(a) no evidence relating to the answer may be adduced, and

(b) no question relating to it may be asked,

by or on behalf of the prosecution, unless evidence relating to it is adduced, or a question relating to it is asked, in the proceedings by or on behalf of that person.

(5B) Paragraph (5A) applies to any offence other than an offence under Article 7 or 10 of the Perjury (Northern Ireland) Order 1979 (false statements made on an oath otherwise than in judicial proceedings or made otherwise than on oath).]

[F831 (6) In this Article “documents” includes information recorded in any form; and, in relation to information recorded otherwise than in legible form, the power to require its production includes power to require the production of a copy of the information in legible form[F833 , or in a form from which it can readily be produced in visible and legible form].]

F830 mod. by SR 2004/307

F831 1990 NI 10

F832 1999 c. 23

F833 2001 c. 16

Art. 428 rep. by 1990 NI 10

Obstruction of inspectors treated as contempt of court N.I.

429 .F834 — [F835 (1) If any person—

(a) fails to comply with article 427(1)(a) or (c),

(b) refuses to comply with a requirement under Article 427(1)(b) or (2), or

(c) refuses to answer any question put to him by the inspectors for the purposes of the investigation,

the inspectors may certify that fact in writing to the court.]

(3) The court may thereupon inquire into the case; and, after hearing any witnesses who may be produced against or on behalf of the alleged offender and after hearing any statement which may be offered in defence, the court may punish the offender in like manner as if he had been guilty of contempt of the court.

F834 mod. by SR 2004/307

F835 1990 NI 10

Inspectors' reports N.I.

430 .F836 —(1) The inspectors may, and if so directed by the Department shall, make interim reports to the Department, and on the conclusion of their investigation shall make a final report to the Department.

Any such report shall be written or printed, as the Department directs.

[F837 (1A) Any persons who have been appointed under Article 424 or 425 may at any time and, if the Department directs them to do so shall, inform it of any matters coming to their knowledge as a result of their investigation.]

[F838 (1B) If it appears to the Department that matters have come to light in the course of the inspectors' investigation which suggest that a criminal offence has been committed, and those matters have been referred to the appropriate prosecuting authority, it may direct the inspectors to take no further steps in the investigation or to take only such further steps as are specified in the direction.

(1C) Where an investigation is the subject of a direction under paragraph (1B), the inspectors shall make a final report to the Department only where—

(a) they were appointed under Article 425(1) (appointment in pursuance of an order of the court), or

(b) the Department directs them to do so.]

(2) If the inspectors were appointed under Article 425 in pursuance of an order of the court, the Department shall furnish a copy of any report of theirs to the court.

(3) In any case the Department may, if it thinks fit—

(a) forward a copy of any report made by the inspectors to the company's registered office,

(b) furnish a copy on request and on payment of the prescribed fee to—

(i) any member of the company or other body corporate which is the subject of the report,

(ii) any person whose conduct is referred to in the report,

(iii) the auditors of that company or body corporate,

(iv) the applicants for the investigation,

(v) any other person whose financial interests appear in the Department to be affected by the matters dealt with in the report, whether as a creditor of the company or body corporate, or otherwise, and

(c) cause any such report to be printed and published.

F836 mod. by SR 2004/307

F837 1986 c. 60

F838 1990 NI 10

Power to bring civil proceedings on company's behalf N.I.

431.  F839 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F839 Art. 431 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 4(2)(a) (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Expenses of investigating a company's affairs N.I.

432.— [F840 [F841 (1) The expenses of an investigation under any of the powers conferred by this Part shall be defrayed in the first instance by the Department but it may recover those expenses from the persons liable in accordance with this Article.

There shall be treated as expenses of the investigation, in particular, such reasonable sums as the Department may determine in respect of general staff costs and overheads.]

(2) A person who is convicted on a prosecution instituted as a result of the investigation, or is ordered to pay the whole or any part of the costs of proceedings brought under Article 431, may in the same proceedings be ordered to pay those expenses to such extent as may be specified in the order.

(3) A body corporate in whose name proceedings are brought under that Article is liable to the amount or vale of any sums or property recovered by it as a result of those proceedings; and any amount for which a body corporate is liable under this paragraph is a first charge on the sums or property recovered.

(4) A body corporate dealt with by[F841 an inspectors' report], where the inspectors were appointed otherwise than of the Department's own motion, is liable except where it was the applicant for the investigation and except so far as the Department otherwise directs.

[F841 (5) Where inspectors were appointed—

(a )F842 under Article 424, or

(b )F842 on an application under Article 435(3),

the applicant or applicants for the investigation is or are liable to such extent (if any) as the Department may direct.]

(6) The report of inspectors appointed otherwise than of the Department's own motion may, if they think fit, and shall if the Department so directs, include a recommendation as to the directions (if any) which they think appropriate, in the light of their investigation, to be given under paragraph (4) or (5).

(7) For the purposes of this Article, any costs or expenses incurred by the Department in or in connection with proceedings brought under Article 431 (including expenses incurred under paragraph (2) of it) are to be treated as expenses of the investigation giving rise to the proceedings.

(8) Any liability to repay the Department imposed by paragraphs (2) and (3) is (subject to satisfaction of the Department's right to repayment) a liability also to indemnify all persons against liability under paragraphs (4) and (5); and any such liability imposed by paragraph (2) is (subject as mentioned above) a liability also to indemnify all persons against liability under paragraph (3).

(9) A person liable under any one of paragraphs (2) to (5) is entitled to contribution from any other person liable under the same paragraph, according to the amount of their respective liabilities under it.]

F840 Art. 432 repealed (6.4.2007 for certain purposes, otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

F841 1990 NI 10

F842 mod. by SR 2004/307

Art. 433 rep. by 1990 NI 10

Inspectors' report to be evidence N.I.

434 .F843 —(1) A copy of any report of inspectors appointed under [F844 this Part] certified by the Department to be a true copy, is admissible in any legal proceedings as evidence of the opinion of the inspectors in relation to any matter contained in the report[F845 and in proceedings on an application under[F846 Article 11 of the Company Directors Disqualification (Northern Ireland) Order 2002], as evidence of any fact stated in the report].

(2) A document purporting to be such a certificate as is mentioned in paragraph (1) shall be received in evidence and be deemed to be such a certificate, unless the contrary is proved.

F843 mod. by SR 2004/307

F844 1990 NI 10

F845 1989 NI 18

F846 2002 NI 4

Other powers of investigation available to the DepartmentF1029 N.I.

Power to investigate company ownership N.I.

435.—(1) Where it appears to the Department that there is good reason to do so, the Department may appoint one or more competent inspectors to investigate and report on the membership of any company, and otherwise with respect to the company, for the purpose of determining the true persons who are or have been financially interested in the success or failure (real or apparent) of the company or able to control or materially to influence its policy.

(2) The appointment of inspectors under this Article may define the scope of their investigation (whether as respects the matters or the period to which it is to extend or otherwise) and in particular may limit the investigation to matters connected with particular shares or debentures.

[F847 (3) If an application for investigation under this Article with respect to particular shares or debentures of a company is made to the Department by members of the company, and the number of applicants or the amount of shares held by them is not less than that required for an application for the appointment of inspectors under Article 424(2)(a) or (b), then, subject to the following provisions, the Department shall appoint inspectors to conduct the investigation applied for.

(3A) The Department shall not appoint inspectors if it is satisfied that the application is vexatious; and where inspectors are appointed their terms of appointment shall exclude any matter in so far as the Department is satisfied that it is unreasonable for it to be investigated.

(3B) The Department may, before appointing inspectors, require the applicant or applicants to give security, to an amount not exceeding £5,000, or such other sum as it may by order subject to negative resolution specify, for payment of the costs of the investigation.

(3C) If on an application under paragraph (3) it appears to the Department that the powers conferred by Article 437 are sufficient for the purposes of investigating the matters which inspectors would be appointed to investigate, it may instead conduct the investigation under that Article.]

(4) Subject to the terms of their appointment, the inspectors' powers extend to the investigation of any circumstances suggesting the existence of an arrangement or understanding which, though not legally binding, is or was observed or likely to be observed in practice and which is relevant to the purposes of the investigation.

F847 1990 NI 10

Provisions applicable on investigation under Article 435 N.I.

436.—(1) For the purposes of an investigation under Article 435, Articles 426(1), 427, 429 and 430 apply with the necessary modifications of references to the affairs of the company or to those of any other body corporate, subject however to paragraphs (2) [F848 and (3)].

(2) Those Articles apply to—

(a) all persons who are or have been, or whom the inspector has reasonable cause to believe to be or have been, financially interested in the success or failure or the apparent success or failure of the company or any other body corporate whose membership is investigated with that of the company, or able to control or materially influence its policy (including persons concerned only on behalf of others), and

(b) any other person whom the inspector has reasonable cause to believe possesses information relevant to the investigation.

as they apply in relation to officers and agents of the company or other body corporate (as the case may be).

(3) If the Department is of opinion that there is good reason for not divulging any part of a report made by virtue of Article 435 and this Article, the Department may under Article 430 disclose the report with the omission of that part; and the Department may cause to be kept by the registrar a copy of the report with that part omitted or, in the case of any other such report, a copy of the whole report.

F848 1989 NI 18

Power to obtain information as to those interested in shares, etc. N.I.

437.—(1) If it appears to the Department that there is good reason to investigate the ownership of any shares in or debentures of a company and that it is unnecessary to appoint inspectors for the purpose, the Department may require any person whom the Department has reasonable cause to believe to have or to be able to obtain any information as to the present and past interests in those shares or debentures and the names and addresses of the persons interested and of any persons who act or have acted on their behalf in relation to the shares or debentures to give any such information to the Department.

(2) For this purpose a person is deemed to have an interest in shares or debentures if he has any right to acquire or dispose of them or of any interest in them, or to vote in respect of them, or if his consent is necessary for the exercise of any of the rights of other persons interested in them, or if other persons interested in them can be required, or are accustomed, to exercise their rights in accordance with his instructions.

(3) A person who fails to give information required of him under this Article, or who in giving such information makes any statement which he knows to be false in a material particular, or recklessly makes any statement which is false in a material particular, is liable to imprisonment or a fine, or both.

Power to impose restrictions on shares and debentures N.I.

438.—(1) If in connection with an investigation under either Article 435 or 437 it appears to the Department that there is difficulty in finding out the relevant facts about any shares (whether issued or to be issued), the Department may by order direct that the shares shall until further order be subject to the restrictions imposed by Part XVI.

[F849 (1A) If the Department is satisfied that an order under paragraph (1) may unfairly affect the rights of third parties in respect of shares then the Department, for the purpose of protecting such rights and subject to such terms as it thinks fit, may direct that such acts by such persons and for such purposes as may be set out in the order, shall not constitute a breach of the restrictions of Part XVI.]

(2) This Article, and Part XVI in its application to orders under it, apply in relation to debentures as in relation to shares[F849 save that paragraph (1A) shall not apply.]

F849 SR 1992/257

Investigation of share dealings N.I.

439.—(1) If it appears to the Department that there are circumstances suggesting that contraventions may have occurred, in relation to a company's shares or debentures, of Article 331 or 332 (taken with Schedule 13), or of Article 336(3) to (5) (restrictions on share dealings by directors and their families; obligation of director to disclose shareholding in his own company), the Department may appoint one or more competent inspectors to carry out such investigations as are requisite to establish whether or not such contraventions have occurred and to report the result of their investigations to the Department.

(2) The appointment of inspectors under this Article may limit the period to which their investigation is to extend or confine it to shares or debentures of a particular class, or both.

[F850 (3) Articles 427 to 429 apply for the purposes of an investigation under this Article to the following persons as they apply to officers of the company or of the other body corporate—

(a) an authorised person;

(b) a relevant professional;

(c) a person not falling within sub-paragraph (a) or (b) who may carry on a regulated activity without contravening the prohibition imposed by section 19 of the Financial Services and Markets Act 2000; and

(d) in relation to an authorised person, to a relevant professional or to a person falling within sub-paragraph (c)—

(i) if it is a body corporate, any person who is or has been an officer of it,

(ii) if it is a partnership, any person who is or has been a partner in it,

(iii) if it is an unincorporated association, any person who is or has been a member of its governing body or an officer of it.

(3A) In paragraph (3)—

• “authorised person” has the meaning given in section 31(2) of the Financial Services and Markets Act 2000;

• “relevant professional” means a member of a profession if a body has been designated under section 326(1) of that Act in relation to that profession, and, in relation to such a profession, "member" has the meaning given in section 325(2) of that Act.]

(4) Articles 427 to 429 apply under paragraph (3)—

[F851 (a) to an individual who is an authorised person within the meaning of the Financial Services Act 1986;

(b) to any individual who holds a permission granted under paragraph 23 of Schedule 1 to that Act;

(c) to an officer (whether past or present) of a body corporate which is such an authorised person or holds such a permission;

(d) to any partner (whether past or present) in a partnership which is such an authorised person or holds such a permission;

(e) to any member of the governing body or officer (in either case whether past or present) of an unincorporated association which is such an authorised person or holds such a permission,]

as they apply to officers of the company or of the other body corporate.

Paras. (5), (6) rep. by 1986 c. 60

F850 SI 2001/3649

F851 1986 c. 60

Requisition and seizure of books and papersF1029 N.I.

Department's power to require production of documents N.I.

F852 440 .F853   Para. (1) rep. by 1990 NI 10

(2) The Department may at any time, if it thinks there is good reason to do so, give directions to[F854 a company] requiring it, at such time and place as may be specified in the directions, to produce such[F854 documents] as may be so specified

(3) The Department may at any time, if it thinks there is good reason to do so, authorise an officer of the Department[F854 or any other competent person], on producing (if so required) evidence of his authority, to require[F854 a company] to produce to him forthwith any[F854 documents] which[F854 he] may specify.

(4) Where by virtue of paragraph (2) or (3) the Department or an officer of the Department[F854 or other person] has power to require the production of[F854 documents] from[F854 a company], the Department or the officer[F854 or other person] has the like power to require production of those[F854 documents] from any person who appears to the Department or the officer[F854 or other person] to be in possession of them; but where any such person claims a lien on[F854 documents] produced by him, the production is without prejudice to the lien.

(5)The power under this Article to require[F854 a company] or other person to produce[F854 documents] includes power—

(a)

if the[F854 documents] are produced—

(i)

to take copies of them or extracts from them, and

(ii)

to require that person, or any other person who is a present or past officer of, or is or was at any time employed by,[F854 the company] in question, to provide an explanation of any of them;

(b)

if the[F854 documents] are not produced, to require the person who was required to produce them to state, to the best of his knowledge and belief, where they are.

(6) If the requirement to produce[F854 documents] or provide an explanation or make a statement is not complied with,[F854 the company] or other person on whom the requirement was so imposed is guilty of an offence and liable to a fine.

[F854 Articles 680 (restriction on prosecutions), 680A (liability of individuals for corporate default) and 680B (criminal proceedings against unincorporated bodies) apply to this offence.]

(7) However, where a person is charged with an offence under paragraph (6) in respect of a requirement to produce any[F854 documents], it is a defence to prove that they were not in his possession or under his control and that it was not reasonably practicable for him to comply with the requirement.

(8) A statement made by a person in compliance with such a requirement may be used in evidence against him.

[F855 (8A) However, in criminal proceedings in which that person is charged with an offence to which this paragraph applies—

(a) no evidence relating to the statement may be adduced, and

(b) no question relating to it may be asked,

by or on behalf of the prosecution, unless evidence relating to it is adduced, or a question relating to it is asked, in the proceedings by or on behalf of that person.

(8B) Paragraph (8A) applies to any offence other than—

(a) an offence under paragraph (6) or Article 444; or

(b) an offence under Article 10 of the Perjury (Northern Ireland) Order 1979 (false statements made otherwise than an oath.]

[F854 (9) In this Article “documents” includes information recorded in any form; and, in relation to information recorded otherwise than in legible form, the power to require its production includes power to require the production of a copy of it in legible form[F856 , or in a form from which it can readily be produced in visible and legible form].]

F852 prosp. subst. by 2005 NI 17 (which amendment repealed (1.10.2009) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 Pt. 2)

F853 mod. by SR 2004/307

F854 1990 NI 10

F855 1999 c. 23

F856 2001 c. 16

F857 prosp. insertion by 2005 NI 17 (which amendment repealed (1.10.2009) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 Pt. 2)

[F858 Entry and search of premises N.I.

441 .F859 — (1) A justice of the peace may issue a warrant under this Article if satisfied by complaint on oath made by or on behalf of the Department, or by a person appointed or authorised to exercise powers under this Part, that there are reasonable grounds for believing that there are on any premises documents whose production has been required under this Part and which have not been produced in compliance with the requirement.

(2) A justice of the peace may also issue a warrant under this Article if satisfied by complaint on oath made by or on behalf of the Department, or by a person appointed or authorised to exercise powers under this Part—

(a) that there are reasonable grounds for believing that an offence has been committed for which the penalty on conviction on indictment is imprisonment for a term of not less than two years and that there are on any premises documents relating to whether the offence has been committed,

(b) that the Department, or the person so appointed or authorised, has power to require the production of the documents under this Part, and

(c) that there are reasonable grounds for believing that if production was so required the documents would not be produced but would be removed from the premises, hidden, tampered with or destroyed.

(3) A warrant under this Article shall authorise a constable, together with any other person named in it and any other constables—

(a) to enter the premises specified in the complaint, using such force as is reasonably necessary for the purpose;

(b) to search the premises and take possession of any documents appearing to be such documents as are mentioned in paragraph (1) or (2), as the case may be, or to take, in relation to any such documents, any other steps which may appear to be necessary for preserving them or preventing interference with them;

(c) to take copies of any such documents; and

(d) to require any person named in the warrant to provide an explanation of them or to state where they may be found.

(4) If in the case of a warrant under paragraph (2) the justice of the peace is satisfied by complaint on oath that there are reasonable grounds for believing that there are also on the premises other documents relevant to the investigation, the warrant shall also authorise the actions mentioned in paragraph (3) to be taken in relation to such documents.

(5) A warrant under this Article shall continue in force until the end of the period of one month beginning with the day on which it is issued.

(6) Any documents of which possession is taken under this Article may be retained—

(a) for a period of three months; or

(b) if within that period proceedings to which the documents are relevant are commenced against any person for any criminal offence, until the conclusion of those proceedings.

(7) Any person who intentionally obstructs the exercise of any rights conferred by a warrant issued under this Article or fails without reasonable excuse to comply with any requirement imposed in accordance with paragraph (3)(d) is guilty of an offence and liable to a fine.

Articles 680 (restriction on prosecutions), 680A (liability of individuals for corporate default) and 680B (criminal proceedings against unincorporated bodies) apply to this offence.

(8) For the purposes of Articles 442 and 444A (provision for security of information) documents obtained under this Article shall be treated as if they had been obtained under the provision of this Part under which their production was or, as the case may be, could have been required.

(9) In this Article “document” includes information recorded in any form.]

F858 Art. 441 subst. 1990 NI 10, art. 12(1)

F859 mod. by SR 2004/307

F860 prosp. insertion by 2005 NI 17 (which amendment repealed (1.10.2009) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 Pt. 2)

Provision for security of information obtained N.I.

442 .F861 —(1) No information or document relating to a [F862 company] which has been obtained under Article 440F862 . . . shall, without the previous consent in writing of that[F862 company], be published or disclosed, except to a competent authority, unless the publication or disclosure is required—

[F863 (a) with a view to the institution of or otherwise for the purposes of criminal proceedings;]

[F864 (b) with a view to the institution of, or otherwise for the purposes of, any proceedings on an application under[F865 Article 9, 10 or 11 of the Company Directors Disqualification (Northern Ireland) Order 2002];]

[F862 (c) for the purposes of enabling or assisting any inspector appointed under this Part,F866 . . . , to discharge his functions;]

[F862 (cc) for the purpose of enabling or assisting any person authorised to exercise powers[F866 Article 440 of this Order] or section 84 of the Companies Act 1989 to discharge his functions;]

[F866 (cd) for the purposes of enabling or assisting a person appointed under—

(i) section 167 of the Financial Services and Markets Act 2000 (general investigations),

(ii) section 168 of that Act (investigations in particular cases),

(iii) section 169(1)(b) of that Act (investigation in support of overseas regulator),

(iv) section 284 of that Act (investigations into affairs of certain collective investment schemes), or

(v) regulations made as a result of section 262(2)(k) of that Act (investigations into open-ended investment companies),

to conduct an investigation to discharge his functions;]

[F863 (d) for the purpose of enabling or assisting the Department to exercise any of its functions under this Order, the Insider Dealing Order[F862 Part III of the Companies (Northern Ireland) Order 1990, Part II or V of the Companies (No. 2) (Northern Ireland) Order 1990] orF867 . . . ;

(dd) for the purpose of enabling or assisting the Secretary of State to exercise any functions conferred on him by the enactments relating to companies or insolvency, the Prevention of Fraud (Investments) Act 1958,[F868 or the Financial Services and Markets Act 2000,] or for the purpose of enabling or assisting any inspector appointed by him under the enactments relating to companies to discharge his functions;]

Sub.‐paras. (de), (df) rep. by SI 2001/3649

[F869 (dg) for the purpose of enabling or assisting the Pensions Regulator to discharge the functions conferred on it by or by virtue of the Pension Schemes (Northern Ireland) Act 1993, the Pensions (Northern Ireland) Order 1995, the Welfare Reform and Pensions (Northern Ireland) Order 1999 or the Pensions (Northern Ireland) Order 2005 or any enactment in force in Great Britain corresponding to any of those provisions;

(dh) for the purpose of enabling or assisting the Board of the Pensions Protection Fund to discharge the functions conferred on it by or by virtue of Part III of the Pensions (Northern Ireland) Order 2005 or any provision in force in Great Britain corresponding to that Part.]

Sub-para. (e) rep. by 1990 NI 10

[F863 [F870 (f) for the purpose of enabling or assisting the Bank of England to discharge its functions;]

[F866 (fa) for the purposes of enabling or assisting the Financial Services Authority ot discharge its functions under the legislation relating to friendly societies or to industrial and provident societies, under the Building Societies Act 1986, under Part 7 of the Companies Act 1989 or under the Financial Services and Markets Act 2000;

(g) for the purposes of enabling or assisting a body corporate established in accordance with section 212(1) of the Financial Services and Markets Act 2000 (compensation scheme manager) to discharge its functions;

(h) for the purposes of any proceedings before the Financial Services Tribunal by virtue of the Financial Services and Markets Act 2000 (Transitional Provisions) (Partly Completed Procedures) Order 2001;

(ha) with a view to the institution of or otherwise for the purposes of proceedings before the Financial Services and Markets Tribunal;

(hb) for the purpose of enabling or assisting a recognised investment exchange or a recognised clearing house to discharge its functions as such;

(hc) for the purpose of enabling or assisting a body designated under section 326(1) of the Financial Services and Markets Act 2000 (designated professional bodies) to discharge its functions in its capacity as a body designated under that section;]

• Sub.‐para. (i) rep. by SI 2001/3649

• Sub.‐para. (j) rep. by SI 2001/1283

(k) for the purpose of enabling or assisting the official assignee to discharge his functions under the enactments relating to companies or bankruptcy;

(l) with a view to the institution of, or otherwise for the purposes of, any disciplinary proceedings relating to the exercise by a solicitor, auditor, accountant, valuer or actuary of his professional duties;

[F862 (ll) with a view to the institution of, or otherwise for the purposes of, any disciplinary proceedings relating to the discharge by a public servant of his duties;]

[F862 (m) for the purpose of enabling or assisting an overseas regulatory authority to exercise its regulatory functions.]]

[F871 (n) for the purposes of proceedings before the Pensions Regulator Tribunal.]

[F863 [F862 (1A) In paragraph (1)—

[F866 (aa) in sub-paragraph (hb) “recognised investment exchange” and “recognised clearing house” have the same meaning as in section 285 of the Financial Services and Markets Act 2000;]

(a) in sub-paragraph (ll) “public servant” means an officer or servant of the Crown or of any public or other authority for the time being designated for the purposes of that sub-paragraph by the Department by order;

(b) in sub-paragraph (m) “overseas regulatory authority” and “regulatory functions” have the same meaning as in section 82 of the Companies Act 1989.]

(1B) Subject to paragraph (1C), paragraph (1) shall not preclude publication or disclosure for the purpose of enabling or assisting any public or other authority for the time being[F862 designated for the purposes of this paragraph] by an order made by the Department to discharge any functions which are specified in the order.

(1C) An order under paragraph (1B) designating an authority for the purpose of that paragraph may—

(a) impose conditions subject to which the publication or disclosure of any information or document is permitted by that paragraph; and

(b) otherwise restrict the circumstances in which that paragraph permits publication or disclosure.

Para. (1D) rep. by SI 2001/3649]

(2) A person who publishes or discloses any information or document in contravention of this Article is guilty of an offence and liable to imprisonment or a fine, or both.

[F862 Articles 680 (restriction on prosecutions), 680A (liability of individuals for corporate default) and 680B (criminal proceedings against unincorporated bodies) apply to this offence.]

[F862 (3) For the purposes of this Article each of the following is a competent authority—

(a) the Department,

(b) an inspector appointed under this PartF866 . . . ,

[F866 (ba) a person appointed under—

(i) section 167 of the Financial Services and Markets Act 2000 (general investigations),

(ii) section 168 of that Act (investigations in particular cases),

(iii) section 169(1)(b) of that Act (investigation in support of overseas regulator),

(iv) section 284 of that Act (investigations into affairs of certain collective investment schemes), or

(v) regulations made as a result of section 262(2)(k) of that Act (investigations into open-ended investment companies),

to conduct an investigation;]

(c) any person authorised to exercise powers[F872 or appointed[F866 under Article 440 of this Order]] or section 84 of the Companies Act 1989,

(d) the Secretary of State,

(e) the Treasury,

(f) the Bank of England,

(g) the Lord Advocate,

(h) the Director of Public Prosecutions for Northern Ireland and the Director of Public Prosecutions in England and Wales,

[F866 (ha) the Financial Services Authority;]

(l) any constable,

(m) any procurator fiscal.

(3A) Any information which may by virtue of this Article be disclosed to a competent authority may be disclosed to any officer or servant of the authority.]

[F863 (4) An order under[F862 paragraph (1A)(a) or (1B)] is subject to negative resolution.]

F861 mod. by SR 2004/307

F862 1990 NI 10

F863 1986 c. 60

F864 1989 NI 18

F865 2002 NI 4

F866 SI 2001/3649

F867 Words in art. 442(1)(d) repealed (29.4.1988 for certain purposes, otherwise prosp.) by Financial Services Act 1986 (c. 60), ss. 211(1), 212(3), Sch. 17 Pt. II; S.I. 1988/740, art. 2, Sch.

F868 SI 2004/355

F869 Art. 442(1)(dg)(dh) substituted (6.4.2006) for art. 442(1)(dg) by Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1)), arts. 1(2), 290(1), Sch. 10 para. 2 (with art. 285(5)); S.R. 2006/95, art. 2(c), Sch. Pt. 3

F870 1998 c. 11

F871 Art. 442(1)(n) inserted (6.4.2006) by Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1)), arts. 1(2), 100 (with art. 285(5)); S.R. 2006/95, art. 2(c), Sch. Pt. 3

F872 SI 1994/1696

Punishment for destroying, mutilating, etc. company documents N.I.

443.—(1)  [F873 An officer of a companyF874 . . . ] who—

(a) destroys, mutilates or falsifies, or is privy to the destruction, mutilation or falsification of a document affecting or relating to the[F873 company's] property or affairs, or

(b) makes, or is privy to the making of, a false entry in such a document,

is guilty of an offence, unless he proves that he had no intention to conceal the state of affairs of[F873 the company] or to defeat the law.

[F874 (1A )F875  Paragraph (1) applies to an officer of an authorised insurance company which is not a body corporate as it applies to an officer of a company.]

(2) Such a person as is mentioned in paragraph (1) who fraudulently either parts with, alters or makes an omission in any such document or is privy to fraudulent parting with, fraudulent altering or fraudulent making of an omission in, any such document, is guilty of an offence.

(3) A person guilty of an offence under this Article is liable to imprisonment or a fine, or both.

[F873 (4) Articles 680 (restriction on prosecutions), 680A (liability of individuals for corporate default) and 680B (criminal proceedings against unincorporated bodies) apply to an offence under this Article.]

[F873 (5) In this Article “document” includes information recorded in any form.]

F873 1990 NI 10

F874 SI 2001/3649

F875 mod. by SR 2004/307

Punishment for furnishing false information N.I.

F876 444 .F877   A person who, in purported compliance with a requirement imposed under Article 440 to provide an explanation or make a statement, provides or makes an explanation or statement which he knows to be false in a material particular or recklessly provides or makes an explanation or statement which is so false, is guilty of an offence and liable to imprisonment or a fine, or both.

F876 prosp. subst. by 2005 NI 17

F877 mod. by SR 2004/307

[F878 Disclosure of information by Department or inspector N.I.

444A.— F879 (1 )F880  This Article applies to information obtained under Articles 427 to 439.

(2) The Department may, if it thinks fit—

(a) disclose any information to which this Article applies to any person to whom, or for any purpose for which, disclosure is permitted under Article 442, or

(b) authorise or require an inspector appointed under this Part to disclose such information to any such person or for any such purpose.

[F881 (3) Information to which this Article applies may also be disclosed by an inspector appointed under this Part to—

(a) another inspector appointed under this Part;

(b) a person appointed under—

(i) section 167 of the Financial Services and Markets Act 2000 (general investigations),

(ii) section 168 of that Act (investigations in particular cases),

(iii) section 169(1)(b) of that Act (investigation in support of overseas regulator),

(iv) section 284 of that Act (investigations into affairs of certain collective investment schemes), or

(v) regulations made as a result of section 262(2)(k) of that Act (investigations into open-ended investment companies),

to conduct an investigation; or

(c) a person authorised to exercise powers under—

(i) Article 440 of this Order; or

(ii) section 84 of the Companies Act 1989 (exercise of powers to assist overseas regulatory authority).]

(4) Any information which may by virtue of paragraph (3) be disclosed to any person may be disclosed to any officer or servant of that person.

(5 )F880  The Department may, if it thinks fit, disclose any information obtained under Article 437 to—

(a) the company whose ownership was the subject of the investigation,

(b) any member of the company,

(c) any person whose conduct was investigated in the course of the investigation,

(d) the auditors of the company, or

(e) any person whose financial interests appear to the Department to be affected by matters covered by the investigation.F882 ]

F878 Art. 444A subst. 1990 NI 10, art. 16

F879 prosp. subst. by 2005 NI 17

F880 mod. by SR 2004/307

F881 SI 2001/3649

F882 prosp. insertion by 2005 NI 17 (which amendment repealed (1.10.2009) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 Pt. 2)

Supplementary F1029 N.I.

Privileged information N.I.

445.—F883 (1 )F884  Nothing in Articles 424 to 439 requires the disclosure to the Department or to an inspector appointed by the Department—

(a) by any person of information which he would in an action in the High Court be entitled to refuse to disclose on grounds of legal professional privilege except, if he is a lawyer, the name and address of his client,

Sub-para. (b) rep. by 1990 NI 10

[F885 (1A )F884  Nothing in Article 427, 436 or 439 requires a person (except as mentioned in paragraph (1B)) to disclose information or produce documents in respect of which he owes an obligation of confidence by virtue of carrying on the business of banking unless—

(a) the person to whom the obligation of confidence is owed is the company or other body corporate under investigation,

(b) the person to whom the obligation of confidence is owed consents to the disclosure or production, or

(c) the making of the requirement is authorised by the Department.

(1B) Paragraph (1A) does not apply where the person owing the obligation of confidence is the company or other body corporate under investigation under Article 424, 425 or 426.]

F883 (2) Nothing in Articles 440 to 444 compels the production by any person of a document which he would in an action in the High Court be entitled to refuse on grounds of legal[F886 professional] privilege, or authorises the taking of possession of any such document which is in the person's possession.

F883 (3) The Department shall not under Article 440 require, or authorise an officer of the Department[F885 or other person] to require, the production by a person carrying on the business of banking of a document relating to the affairs of a customer of his unless either it appears to the Department that it is necessary to do so for the purpose of investigating the affairs of the first-mentioned person[F887 or the customer is—]

[F887 (a) a person on whom a requirement has been imposed under that Article, or

(b) an authorised insurance company on whom a requirement to produce information or documents has been imposed by or on behalf of the Secretary of State under Part XI of the Financial Services and Markets Act 2000.]

F883 prosp. subst. by 2005 NI 17

F884 mod. by SR 2004/307

F885 1990 NI 10

F886 1989 NI 18

F887 SI 2001/3649

Investigation of bodies incorporated outside Northern Ireland N.I.

446.— [F888 (1) The provisions of this Part apply to bodies corporate incorporated outside Northern Ireland which are carrying on business in Northern Ireland, or have at any time carried on business there, as they apply to companies under this Order; but subject to the following exceptions, adaptations and modifications.

(2) The following provisions do not apply to such bodies—

(a) Article 424 (investigation on application of company or its members),

(b) Article 431 (power to bring civil proceedings on the company's behalf),

(c) Articles 435 to 438 (investigation of company ownership and power to obtain information as to those interested in shares, &c.), and

(d) Article 439 (investigation of share dealings).

(3) The other provisions of this Part apply to such bodies subject to such adaptations and modifications as may be prescribed.]

F888 Art. 446 repealed (6.4.2007 for certain purposes, otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

F889 prosp. insertion by 2005 NI 17 (which amendment repealed (1.10.2009) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 Pt. 2)

F890 prosp. insertion by 2005 NI 17 (which amendment repealed (1.10.2009) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 Pt. 2)

Valid from 06/04/2008

Offences by bodies corporate N.I.

446D.  Where an offence under any of Articles 441, 442 to 444 and 446B is committed by a body corporate, every officer of the body who is in default also commits the offence. For this purpose—

(a) any person who purports to act as director, manager or secretary of the body is treated as an officer of the body, and

(b) if the body is a company, any shadow director is treated as an officer of the company.

PART XVIF1029 N.I. ORDERS IMPOSING RESTRICTIONS ON SHARES ([F891 ARTICLE 438])

F891 Words in Pt. XVI heading substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(2) (with art. 12)

Consequence of order imposing restrictions N.I.

447.—(1) So long as any shares are directed to be subject to the restrictions of this Part [F892 then, subject to any directions made in relation to an order [F893 pursuant to Article 438(1A) or 449(1A)]]

(a) any transfer of those shares or, in the case of unissued shares, any transfer of the right to be issued with them, and any issue of them, is void;

(b) no voting rights are exercisable in respect of the shares;

(c) no further shares shall be issued in right of them or in pursuance of any offer made to their holder; and

(d) except in a liquidation, no payment shall be made of any sums due from the company on the shares, whether in respect of capital or otherwise.

(2) Where shares are subject to the restrictions of paragraph (1)(a), any agreement to transfer the shares or, in the case of unissued shares, the right to be issued with them is void (except[F892 such agreement or right as may be made or exercised under the terms of directions made by the Department or the court under [F894 Article 438(1A) or 449(1A)] or] an agreement to[F895 transfer] the shares on the making of an order under Article 449(3)(b)).

(3) Where shares are subject to the restrictions of paragraph (1)(c) or (d), an agreement to transfer any right to be issued with other shares in right of those shares, or to receive any payment on them (otherwise than in a liquidation) is void (except[F892 such agreement or right as may be made or exercised under the terms of directions made by the Department or the court under [F896 Article 438(1A) or 449(1A)] or] an agreement to transfer any such right on the[F895 transfer] of the shares on the making of an order under Article 449(3)(b)).

F892 SR 1992/257

F893 Words in art. 447(1) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(3) (with art. 12)

F894 Words in art. 447(2) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(4) (with art. 12)

F895 1990 NI 10

F896 Words in art. 447(3) substituted (1.10.2004) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(5) (with art. 12)

Punishment for attempted evasion of restrictions N.I.

448.—(1)  [F897 Subject to the terms of any directions made under [F898 Article 438(1A) or 449]] A person is liable to a fine if he—

(a) exercise or purports to exercise any right to dispose of any shares which, to his knowledge, are for the time being subject to the restrictions of this Part or of any right to be issued with any such shares, or

(b) votes in respect of any such shares (whether as holder or proxy), or appoints a proxy to vote in respect of them, or

(c) being the holder of any such shares, fails to notify of their being subject to those restrictions any person whom he does not know to be aware of that fact but does know to be entitled (apart from the restrictions) to vote in respect of those shares whether as holder or as proxy, or

(d) being the holder of any such shares, or being entitled to any right to be issued with other shares in right of them or to receive any payment on them (otherwise than in a liquidation), enters into any agreement which is void under Article 447(2) or (3).

(2) [F897 Subject to the terms of any directions made under [F899 Article 438(1A) or 449]] If shares in a company are issued in contravention of the restrictions, the company and every officer of it who is in default is liable to a fine.

(3) Article 680 (restriction on prosecutions) applies to an offence under this Article.

F897 SR 1992/257

F898 Art. 448(1) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(6) (with art. 12)

F899 Art. 448(2) substituted (1.10.2007) by Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(7) (with art. 12)

Relaxation and removal of restrictions N.I.

449.—(1) Where shares in a company are by order made subject to the restrictions of this Part, application may be made to the court for an order directing that the shares be no longer so subject.

[F900 (1A) Where the court is satisfied that an order subjecting the shares to the restrictions of this Part unfairly affects the rights of third parties in respect of shares then the court, for the purpose of pretecting such rights and subject to such terms as it thinks fit and in addition to any order it may make under paragraph (1), may direct on an application made under that paragraph that such acts by such persons and for such purposes as may be set out in the order, shall not constitute breach of the restrictions of Part XVI.

Paragraph (3) does not apply to an order made under this paragragh.]

(2) If the order applying the restrictions was made by the Department, or it has refused to make an order disapplying them, the application may be made by any person aggrieved; F901 . . .

(3) Subject as follows, and order of the court or the Department directing that shares shall cease to be subject to the restrictions may be made only if—

(a) the court or (as the case may be) the Department is satisfied that the relevant facts about the shares have been disclosed to the company and no unfair advantage has accrued to any person as a result of the earlier failure to make that disclosure, or

(b) the shares are to be[F902 transferred for valuable consideration] and the court (in any case) or the Department (if the order was made under Article F903 . . . 438) approves the[F902 transfer].

(4) [F900 Without prejudice to the power of the court to give directions under paragraph (1A),] where shares in a company are subject to the restrictions, the court may on application order the shares to be sold, subject to the court's approval as to the sale, and may also direct that the shares shall cease to be subject to the restrictions.

An application to the court under this paragraph may be made by the Department F904 . . . , or by the company.

(5) Where an order has been made under paragraph (4), the court may on application make such further order relating to the sale or transfer of the shares as it thinks fit.

An application to the court under this paragraph may be made—

(a)

by the Department F905 . . . , or

(b)

by the company, or

(c)

by the person appointed by or in pursuance of the order to effect the sale, or

(d)

by any person interested in the shares.

(6) An order (whether of the Department or the court) directing that shares shall cease to be subject to the restrictions of this Part, if it is—

(a) expressed to be made with a view to permitting a transfer of the shares, or

(b) made under paragraph (4),

may continue the restrictions mentioned in Article 447(1)(c) and (d), either in whole or in part, so far as they relate to any right acquired or offer made before the transfer.

(7) Paragraph (3) does not apply to an order directing that shares shall cease to be subject to any restrictions which have been continued in force in relation to those shares under paragraph (6).

F900 SR 1992/257

F901 Words in art. 449(2) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(8) (with art. 12)

F902 1990 NI 10

F903 Words in art. 449(3)(b) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(9) (with art. 12)

F904 Words in art. 449(4) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(10) (with art. 12)

F905 Words in art. 449(5)(a) omitted (1.10.2007) by virtue of Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), arts. 1(3), 10(1), Sch. 4 para. 27(11) (with art. 12)

Further provisions on sale by court order of restricted shares N.I.

450.—(1) Where shares are sold in pursuance of an order of the court under Article 449(4) the proceeds of sale, less the costs of the sale, shall be paid into court for the benefit of the persons who are beneficially interested in the shares; and any such person may apply to the court for the whole or part of those proceeds to be paid to him.

(2) On application under paragraph (1) the court shall (subject to paragraph (3)) order the payment to the applicant of the whole of the proceeds of sale together with any interest thereon or, if any other person had a beneficial interest in the shares at the time of their sale, such proportion of those proceeds and interest as is equal to the proportion which the value of the applicant's interest in the shares bears to the total value of the shares.

(3) On granting an application for an order under Article 449(4) or (5) the court may order that the applicant's costs be paid out of the proceeds of sale; and if that order is made, the applicant is entitled to payment of his costs out of those proceeds before any person interested in the shares in question receives any part of those proceeds.

PART XVIIF1029 N.I. FRAUDULENT TRADING BY A COMPANY

Punishment for fraudulent trading N.I.

451.  F906 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F906 Arts. 451-454 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12, Sch. 3 para. 46)

PART XVIIIF1029 N.I. PROTECTION OF COMPANY'S MEMBERS AGAINST UNFAIR PREJUDICE

Order on application of company member N.I.

452.  F907 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F907 Arts. 451-454 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Order on application of the Department N.I.

453.  F908 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F908 Arts. 451-454 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Provisions as to petitions and orders under this Part N.I.

454.  F909 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F909 Arts. 451-454 repealed (1.10.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2007/2194, arts. 1(3)(a), 8, Sch. 2 Pt. 2 (with art. 12)

Part XIX - rep. by 1989 NI 19F1029 N.I.

PART XXF1029 N.I. WINDING UP OF COMPANIES REGISTERED UNDER THIS ORDER OR THE FORMER COMPANIES ACTS

F1029 N.I. CHAPTER I - V - Rep. by 1989 NI 19

CHAPTER VIF1029 N.I. PROVISIONS AS TO DISSOLUTION

Power of court to declare dissolution of company void N.I.

602 .F910 —(1) Where a company has been dissolved, the court mayF911 . . . , on an application made for the purpose by the liquidator of the company or by any other person appearing to the court to be interested, make an order, on such terms as the court thinks fit, declaring the dissolution to have been void.

(2) Thereupon such proceedings may be taken as might have been taken if the company had not been dissolved.

(3) It is the duty of the person on whose application the order was made, within 7 days after its making (or such further time as the court may allow), to deliver to the registrar for registration an office copy of the order.

If the person fails to do so, he is liable to a fine and, for continued contravention, to a daily default fine.

[F911 (4) Subject to the following provisions, an application under this Article may not be made after the end of the period of two years from the date of the dissolution of the company.

(5) An application for the purpose of bringing proceedings against the company—

(a) for damages in respect of personal injuries (including any sum claimed by virtue of section 14(2)(c) of the Law Reform (Miscellaneous Provisions) Act (Northern Ireland) 1937 (funeral expenses)), or

(b) for damages under the Fatal Accidents (Northern Ireland) Order 1977,

may be made at any time; but no order shall be made on such an application if it appears to the court that the proceedings would fail by virtue of any statutory provision as to the time within which proceedings must be brought.

(6) Nothing in paragraph (5) affects the power of the court on making an order under this Article to direct that the period between the dissolution of the company and the making of the order shall not count for the purposes of any such statutory provision.

(7) In paragraph (5)(a) “personal injuries” includes any disease and any impairment of a person's physical or mental condition.]

F910 mod. by SR 2004/307

F911 1990 NI 10

Modifications etc. (not altering text)

C9 Art. 602(1) modified (prosp.) by Charities Act (Northern Ireland) 2008 (c. 12), ss. 95(3), 185(1)

Registrar may strike defunct company off register N.I.

603.—(1) If the registrar has reasonable cause to believe that a company is not carrying on business or in operation, he may send to the company by post a letter inquiring whether the company is carrying on business or in operation.

(2) If the registrar does not within one month of sending the letter receive any answer to it, he shall within 14 days after the expiration of that month send to the company by registered post or recorded delivery service a letter referring to the first letter, and stating that no answer to it has been received, and that if an answer is not received to the second letter within one month from its date, a notice will be published in the Belfast Gazette with a view to striking the company's name off the register

(3) If the registrar either receives an answer to the effect that the company is not carrying on business or in operation, or does not within one month after sending the second letter receive any answer, he may publish in the Belfast Gazette, and send to the company by post, a notice that at the expiration of 3 months from the date of that notice the name of the company mentioned in it will, unless cause is shown to the contrary, be struck off the register and the company will be dissolved.

(4) If, in a case where a company is being wound up, the registrar has reasonable cause to believe either that no liquidator is acting, or that the affairs of the company are fully wound up, and the returns required to be made by the liquidator have not been made for a period of 6 consecutive months, the registrar shall publish in the Belfast Gazette and send to the company or the liquidator (if any) a like notice as is provided in paragraph (3).

(5) At the expiration of the time mentioned in the notice the registrar may, unless cause to the contrary is previously shown by the company, strike its name off the register, and shall publish notice of this in the Belfast Gazette; and on the publication of that notice in the Belfast Gazette the company is dissolved.

(6) However—

(a )F912 the liability (if any) of every director, managing officer and member of the company continues and may be enforced as if the company has not been dissolved, and

(b) nothing in paragraph (5) or sub-paragraph (a) affects the power of the court to wind up a company the name of which has been struck off the register.

(7) A notice to be sent to a liquidator under this Article may be addressed to him at his last known place of business; and a letter or notice to be sent under this Article to a company may be addressed to the company at its registered office, or if no office has been registered, to the care of some officer of the company.

If there is no officer of the company whose name and address are know to the registrar, the letter or notice may be sent to each of the persons who subscribed the memorandum, addressed to him at the address mentioned in the memorandum.

F912 mod. by SR 2004/307

Modifications etc. (not altering text)

C10 Art. 603(2) modified (prosp.) by Charities Act (Northern Ireland) 2008 (c. 12), ss. 95(4), 185(1)

Registrar may strike private company off register on application N.I.

603A .F913 —(1 )F913  On application by a private company, the registrar may strike the company's name off the register.

(2) An application by a company under this Article shall—

(a )F913 be made on its behalf by its directors or by a majority of them,

(b )F913 be in the prescribed form, and

(c) contain the prescribed information.

(3) The registrar shall not strike a company off under this Article until after the expiration of 3 months from the publication by him in the Belfast Gazette of a notice—

(a) stating that he may exercise his power under this Article in relation to the company, and

(b) inviting any person to show cause why he should not do so.

(4) Where the registrar strikes a company off under this Article, he shall publish notice of that fact in the Belfast Gazette.

(5) On the publication in the Belfast Gazette of a notice under paragraph (4), the company to which the notice relates is dissolved.

(6 )F913  However, the liability (if any) of every director, managing officer and member of the company continues and may be enforced as if the company had not been dissolved.

(7) Nothing in this Article affects the power of the court to wind up a company the name of which has been struck off the register.

F913 mod. by SR 2004/307

Duties in connection with making application under Article 603A N.I.

603B.—(1) A person shall not make an application under Article 603A on behalf of a company if, at any time in the previous 3 months, the company has—

(a) changed its name,

(b) traded or otherwise carried on business,

(c) made a disposal for value of property or rights which, immediately before ceasing to trade or otherwise carry on business, it held for the purpose of disposal for gain in the normal course of trading or otherwise carrying on business, or

(d) engaged in any other activity, except one which is—

(i) necessary or expedient for the purpose of making an application under Article 603A, or deciding whether to do so,

(ii) necessary or expedient for the purpose of concluding the affairs of the company,

(iii) necessary or expedient for the purpose of complying with any statutory requirement, or

(iv) specified for the purposes of this head by the Department by order made subject to negative resolution.

(2) For the purposes of paragraph (1), a company shall not be treated as trading or otherwise carrying on business by virtue only of the fact that it makes a payment in respect of a liability incurred in the course of trading or otherwise carrying on business.

(3) A person shall not make an application under Article 603A on behalf of a company at a time when any of the following is the case—

(a) an application has been made to the court under Article 418 on behalf of the company for the sanctioning of a compromise or arrangement and the matter has not been finally concluded;

(b) a voluntary arrangement in relation to the company has been proposed under Part II of the Insolvency (Northern Ireland) Order 1989 and the matter has not been finally concluded;

[F914 (c) the company is in administration under Part III of that Order;

(ca) an application to the court for an administration order in respect of the company has been made and not finally dealt with or withdrawn;

(cb) a copy of notice of intention to appoint an administrator of the company under paragraph 15 of Schedule B1 to that Order has been filed with the court and neither of the events mentioned in paragraph 45(2)(a) and (b) of that Schedule has occurred;

(cc) a copy of notice of intention to appoint an administrator of the company under paragraph 23 of that Schedule has been filed with the court and neither of the events mentioned in paragraph 45(4)(a) and (b) of that Schedule has occurred;]

(d) the company is being wound up under Part V of that Order, whether voluntarily or by the court, or a petition under that Part for the winding up of the company by the court has been presented and not finally dealt with or withdrawn;

(e) there is a receiver or manager of the company's property.

(4) For the purposes of paragraph (3)(a), the matter is finally concluded if—

(a) the application has been withdrawn,

(b) the application has been finally dealt with without a compromise or arrangement being sanctioned by the court, or

(c) a compromise or arrangement has been sanctioned by the court and has, together with anything required to be done under any provision made in relation to the matter by order of the court, been fully carried out.

(5) For the purposes of paragraph (3)(b), the matter is finally concluded if—

(a )F915 no meetings are to be summoned under Article 16 of the Insolvency (Northern Ireland) Order 1989,

(b )F915 meetings summoned under that Article fail to approve the arrangement with no, or the same, modifications,

(c )F915 an arrangement approved by meetings summoned under that Article, or in consequence of a direction under Article 19(4)(b) of that Order, has been fully implemented, or

(d )F915 the court makes an order under paragraph (5) of Article 19 of that Order revoking approval given at previous meetings and, if the court gives any directions under paragraph (6) of that Article, the company has done whatever it is required to do under those directions.

(6) A person who makes an application under Article 603A on behalf of a company shall secure that a copy of the application is given, within 7 days from the day on which the application is made, to every person who, at any time on that day, is—

(a) a member of the company,

(b) an employee of the company,

(c) a creditor of the company,

(d) a director of the company,

(e) a manager or trustee of any pension fund established for the benefit of employees of the company, or

(f) a person of a description specified for the purposes of this sub-paragraph by regulations made by the Department.

(7) Paragraph (6) shall not require a copy of the application to be given to a director who is a party to the application.

(8) The duty imposed by paragraph (6) shall cease to apply if the application is withdrawn before the end of the period for giving the copy application.

(9) The Department may by order, made subject to negative resolution, amend paragraph (1) for the purpose of altering the period in relation to which the doing of the things mentioned in sub-paragraphs (a) to (d) of that paragraph is relevant.

F914 Art. 603B(3)(c)-(cc) substituted (27.3.2006) for art. 603B(3)(c) by Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)), arts. 1(3), 3(3), Sch. 2 para. 16; S.R. 2006/21, art. 2 (with S.R. 2006/22, arts. 2-7)

F915 mod. by SR 2004/307

Modifications etc. (not altering text)

C11 Art. 603B(6) modified (prosp.) by Companies (Audit, Investigations and Community Enterprise) (Northern Ireland) Order 2005 (S.I. 2005/1967 (N.I. 17)), arts. 1(2), 49(3)

Directors' duties following application under Article 603A N.I.

603C.—(1) Paragraph (2) applies in relation to any time after the day on which a company makes an application under Article 603A and before the day on which the application is finally dealt with or withdrawn.

(2 )F916  A person who is a director of the company at the end of a day on which a person other than himself becomes—

(a) a member of the company,

(b) an employee of the company,

(c) a creditor of the company,

(d )F916 a director of the company,

(e) a manager or trustee of any pension fund established for the benefit of employees of the company, or

(f) a person of a description specified for the purposes of this sub-paragraph by regulations made by the Department,

shall secure that a copy of the application is given to that person within 7 days from that day.

(3) The duty imposed by paragraph (2) shall cease to apply if the application is finally dealt with or withdrawn before the end of the period for giving the copy application.

(4) Paragraph (5) applies where, at any time on or after the day on which a company makes an application under Article 603A and before the day on which the application is finally dealt with or withdrawn—

(a) the company—

(i) changes its name,

(ii) trades or otherwise carries on business,

(iii) makes a disposal for value of any property or rights other than those which it was necessary or expedient for it to hold for the purpose of making, or proceeding with, an application under Article 603A, or

(iv) engages in any other activity, except one to which paragraph (6) applies;

(b) an application is made to the court under Article 418 on behalf of the company for the sanctioning of a compromise or arrangement;

(c) a voluntary arrangement in relation to the company is proposed under Part II of the Insolvency (Northern Ireland) Order 1989;

[F917 (d) an application to the court for an administration order in respect of the company is made under paragraph 13 of Schedule B1 to that Order;

(da) an administrator is appointed in respect of the company under paragraph 15 or 23 of that Schedule;

(db) a copy of notice of intention to appoint an administrator of the company under paragraph 15 or 23 of that Schedule is filed with the court;]

(e) there arise any of the circumstances in which, under Article 70(1) of that Order, the company may be voluntarily wound up;

(f) a petition is presented for the winding up of the company by the court under Part V of that Order; or

(g) a receiver or manager of the company's property is appointed.

(5 )F916  A person who, at the end of a day on which an event mentioned in any of sub-paragraphs (a) to (g) of paragraph (4) occurs, is a director of the company shall secure that the company's application is withdrawn forthwith.

(6) This paragraph applies to any activity which is—

(a) necessary or expedient for the purpose of making, or proceeding with, an application under Article 603A,

(b) necessary or expedient for the purpose of concluding affairs of the company which are outstanding because of what has been necessary or expedient for the purpose of making, or proceeding with, such an application,

(c) necessary or expedient for the purpose of complying with any statutory requirement, or

(d )F916 specified for the purposes of this paragraph by the Department by order made subject to negative resolution.

(7) For the purposes of paragraph (4)(a), a company shall not be treated as trading or otherwise carrying on business by virtue only of the fact that it makes a payment in respect of a liability incurred in the course of trading or otherwise carrying on business.

F916 mod. by SR 2004/307

F917 Art. 603C(4)(d)-(db) substituted (27.3.2006) for art. 603C(4)(d) by Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)), arts. 1(3), 3(3), Sch. 2 para. 17; S.R. 2006/21, art. 2 (with S.R. 2006/22, arts. 2-7)

Articles 603B and 603C: supplementary provisions N.I.

603D .F918 —(1) For the purposes of section 24 of the Interpretation Act (Northern Ireland) 1954 (which relates to the service of documents by post) in its application to a document required to be given to any person under Article 603B(6) or 603C(2), the principal office of a body corporate or partnership which—

(a) is incorporated or formed under the law of a country or territory outside the United Kingdom, and

(b) has a place of business in the United Kingdom,

shall be taken to be its principal office in the United Kingdom.

(2) Where a creditor of the company has more than one place of business, section 24(2) of the Act of 1954 shall have effect, so far as concerns the giving of a document to him under Article 603B(6) or 603C(2), as if for paragraphs (b) and (c) there were substituted—

“(b) it is left, or sent by post to him in accordance with subsection (1), at each place of business of his with which the company has had dealings in relation to a matter by virtue of which he is a creditor of the company.”

(3) An order or regulations under Article 603B or 603C may make such transitional provisions as the Department considers appropriate.

(4) For the purposes of Articles 603B and 603C, an application under Article 603A is withdrawn if notice of withdrawal in the prescribed form is given to the registrar.

(5) In Articles 603B and 603C, "disposal" includes part disposal.

(6) In Articles 603B and 603C and this Article, "creditor" includes a contingent or prospective creditor.

F918 mod. by SR 2004/307

Articles 603B and 603C: enforcement N.I.

603E .F919 —(1) A person who breaches or fails to perform a duty imposed on him by Article 603B or 603C is guilty of an offence and liable to a fine.

(2) A person who fails to perform a duty imposed on him by Article 603B(6) or 603C(2) with the intention of concealing the making of the application in question from the person concerned is guilty of an offence and liable to imprisonment or a fine, or both.

(3) In any proceedings for an offence under paragraph (1) consisting of breach of a duty imposed by Article 603B(1) or (3), it shall be a defence for the accused to prove that he did not know, and could not reasonably have known, of the existence of the facts which led to the breach.

(4) In any proceedings for an offence under paragraph (1) consisting of failure to perform the duty imposed by Article 603B(6), it shall be a defence for the accused to prove that he took all reasonable steps to perform the duty.

(5) In any proceedings for an offence under paragraph (1) consisting of failure to perform a duty imposed by Article 603C(2) or (5) it shall be a defence for the accused to prove—

(a) that at the time of the failure he was not aware of the fact that the company had made an application under Article 603A, or

(b) that he took all reasonable steps to perform the duty.

F919 mod. by SR 2004/307

Other offences connected with Article 603A N.I.

603F .F920 —(1) Where a company makes an application under Article 603A, any person who, in connection with the application, knowingly or recklessly furnishes any information to the registrar which is false or misleading in a material particular is guilty of an offence and liable to a fine.

(2) Any person who knowingly or recklessly makes an application to the registrar which purports to be an application under Article 603A, but which is not, is guilty of an offence and liable to a fine.

F920 mod. by SR 2004/307

Objection to striking off by person aggrieved N.I.

604 .F921 —(1) This Article applies if a company or any member or creditor of it feels aggrieved by the company having been struck off the register.

(2) The court, on an application by the company or the member or creditor made before the expiration of 20 years from publication in the Belfast Gazette of notice under Article 603, may, if satisfied that the company was at the time of the striking off carrying on business or in operation, or otherwise that it is just that the company be restored to the register, order the company's name to be restored.

[F922 (2A) Paragraphs (2B) and (2D) apply if a company has been struck off the register under Article 603A.

(2B) The court, on an application by a notifiable person made before the expiration of 20 years from publication in the Belfast Gazette of notice under Article 603A(4), may, if satisfied—

(a) that any duty under Article 603B or 603C with respect to the giving to that person of a copy of the company's application under Article 603A was not performed,

(b) that the making of the company's application under Article 603A involved a breach of duty under Article 603B(1) or (3), or

(c) that it is for some other reason just to do so,

order the company's name to be restored to the register.

(2C) In paragraph (2B), “notifiable person” means a person to whom a copy of the company's application under Article 603A was required to be given under Article 603B or 603C.

(2D) The court, on an application by the Department made before the expiration of 20 years from publication in the Belfast Gazette of notice under Article 603A(4), may, if satisfied that it is in the public interest to do so, order the company's name to be restored.]

(3) On an office copy of[F922 an order under paragraph (2), (2B) or (2D)] being delivered to the registrar for registration the company[F922 to which the order relates] is deemed to have continued in existence as if its name had not been struck off; and the court may by the order give such directions and make such provisions as seem just for placing the company and all other persons in the same position (as nearly as may be) as if the company's name had not been struck off.

F921 mod. by SR 2004/307

F922 1994 c. 40

Property of dissolved company to be a bona vacantia N.I.

605 .F923 —F924 F925 (1) When a company is dissolved, all property and rights whatsoever vested in or held on trust for the company immediately before its dissolution (including leasehold property, but not including property held by the company on trust for any other person) are deemed to be bona vacantia and—

(a) accordingly belong to the Crown, and

(b) vest and may be dealt with in the same manner as other bona vacantia accruing to the Crown.

(2) Except as provided by Article 606, the foregoing provisions of this Article have effect subject and without prejudice to any order made by the court under Article 602 or 604.

F923 mod. 1986 c. 53

F924 mod. prosp. by 1992 c. 40

F925 mod. by SR 2004/307

Effect on Article 605 of company's revival after dissolution N.I.

606 .F926 —F927 F928 (1) The Crown, in whom any property or right is vested by Article 605, may dispose of, or an interest in, that property or right notwithstanding that an order may be made under Article 602 or 604.

(2) Where such an order is made—

(a) it does not affect the disposition (but without prejudice to the order so far as it relates to any other property or right previously vested in or held on trust for the company), and

(b) the Crown shall pay to the company an amount equal to—

(i) the amount of any consideration received for the property or right, or interest therein, or

(ii) the value of any such consideration at the time of the disposition,

or if no consideration was received, an amount equal to the value of the property, right or interest disposed of, as at the date of the disposition.

(3) This Article applies in relation to the disposition of any property, right or interest on or after 1st July 1983, whether the company concerned was dissolved before, on or after that day.

F926 mod. 1986 c. 53

F927 mod. prosp. by 1992 c. 40

F928 mod. by SR 2004/307

Crown disclaimer of property vesting as bona vacantia N.I.

607 .F929 —F930 F931 (1) Where any property vests in the Crown under Article 605 the Crown's title to it under that Article may be disclaimed by a notice signed by the Treasury Solicitor.

(2) The right to execute a notice of disclaimer under this Article may be waived by or on behalf of the Crown either expressly or by taking possession or other act evincing that intention.

(3) A notice of disclaimer under this Article is of no effect unless it is executed—

(a) within 12 months of the date on which the vesting of the property under Article 605 came to the notice of the Treasury Solicitor, or

(b) if an application in writing is made to the Treasury Solicitor by any person interested in the property requiring him to decide whether he will or will not disclaim, within a period of 3 months after the receipt of the application or such further period as may be allowed by the court.

(4) A statement in a notice of disclaimer of any property under this Article that the vesting of it came to the notice of the Treasury Solicitor on a specified date, or that no such application as is mentioned in paragraph (3)(b) was received by him with respect to the property before a specified date, is sufficient evidence of the fact stated, until the contrary is proved.

(5) A notice of disclaimer under this Article shall be delivered to the registrar for registration; and copies of it shall be published in the Belfast Gazette and sent to any persons who have given the Treasury Solicitor notice that they claim to be interested in the property.

F929 mod. 1986 c. 53

F930 mod. prosp. by 1992 c. 40

F931 mod. by SR 2004/307

Effect of Crown disclaimer under Article 607 N.I.

608 .F932   F933 F934 Where notice of disclaimer is executed under Article 607 as respects any property, that property is deemed not to have vested in the Crown under Article 605 and as regards that property,[F935 Article 152(3) and Articles 153 to 156 of the Insolvency Order shall apply] as if the property had been disclaimed by the liquidator under[F935 that Article 152] immediately before the dissolution of the company.

F932 mod. 1986 c. 53

F933 mod. prosp. by 1992 c. 40

F934 mod. by SR 2004/307

F935 1989 NI 19

Liability for rentcharge on company's land after dissolution N.I.

609 .F936 —F937 F938 (1) [F939 Article 154 of the Insolvency Order shall apply] to land which by operation of law vests subject to a rentcharge in the Crown or any other person on the dissolution of a company as it applies to land so vesting on a disclaimer under[F939 that Article].

(2) In this Article “company” includes any body corporate.

F936 mod. 1986 c. 53

F937 mod. prosp. by 1992 c. 40

F938 mod. by SR 2004/307

F939 1989 NI 19

Arts. 610-624 rep. by 1989 NI 19

F1029 N.I. CHAPTER VII - rep. by 1989 NI 19

PART XXI rep. by 1989 NI 19F1029 N.I.

PART XXIIF1029 N.I. BODIES CORPORATE SUBJECT, OR BECOMING SUBJECT, TO THIS ORDER (OTHERWISE THAN BY ORIGINAL FORMATION UNDER PART II)

CHAPTER IF1029 N.I. COMPANIES FORMED OR REGISTERED UNDER FORMER COMPANIES ACTS

Companies formed and registered under former Companies Acts N.I.

625.—(1) In its application to existing companies, this Order applies in the same manner—

(a) in the case of a limited company (other than a company limited by guarantee) as if the company had been formed and registered under Part II as a company limited by shares,

(b) in the case of a company limited by guarantee, as if the company had been formed and registered under that Part as a company limited by guarantee, and

(c) in the case of a company other than a limited company, as if the company had been formed and registered under that Part as an unlimited company.

(2) But reference, express or implied, to the date of registration is to be read as the date at which the company was registered under the former Companies Acts.

Companies registered but not formed under former Companies Acts N.I.

626.—(1) This Order applies to every company registered but not formed under the former Companies Acts, in the same manner as it is in Chapter II declared to apply to companies registered but not formed under this Order.

(2) But reference, express or implied, to the date of registration is to be read as referring to the date at which the company was registered under the former Companies Acts.

Companies re-registered with altered status under former Companies Acts N.I.

627.—(1) This Order applies to every unlimited company registered or re-registered as limited in pursuance of the [1879 c. 76] Companies Act 1879, section 57 of the [1908 c. 69] Companies (Consolidation) Act 1908, section 16 of the [1932 c. 7(N.I.)] Companies Act (Northern Ireland) 1932, section 16 of the Act of 1960 or Article 119 of the Order of 1978 as it (this Order) applies to an unlimited company re-registered as limited in pursuance of Part III.

(2) But reference, express or implied, to the date of registration or re-registration is to be read as referring to the date at which the company was registered or re-registered as a limited company under the relevant statutory provision.

Companies registered under Joint Stock Companies Acts N.I.

628.—(1) A company registered under the Joint Stock Companies Acts may cause its shares to be transferred in manner hitherto in use, or in such other manner as the company may direct.

(2) The power of altering a company's articles under Article 20 extends, in the case of an unlimited company formed and registered under the Joint Stock Companies Acts, to altering any regulations relating to the amount of capital or to its distribution into shares, notwithstanding that those regulations are contained in the memorandum.

CHAPTER IIF1029 N.I. COMPANIES NOT FORMED UNDER COMPANIES LEGISLATION, BUT AUTHORISED TO REGISTER

Companies capable of being registered under this Chapter N.I.

629.—(1) With the exceptions and subject to the provisions contained in this Article and Article 630—

(a) any company consisting of 2 or more members, which was in existence on 2nd November 1862, including any company registered under the Joint Stock Companies Acts, and

(b) any company formed after that date (whether before or after the commencement of this Order), in pursuance of any statutory provision (other than this Order), or of letters patent, or being otherwise duly constituted according to law, and consisting of 2 or more members,

may at any time, on making application in the prescribed form, register under this Order as an unlimited company, or as a company limited by shares, or as a company limited by gurarantee; and the registration is not invalid by reason that it has taken place with a view to the company's being wound up.

[F940 (1A) A company shall not be prevented from registering under this Order as a private company limited by shares or by guarantee solely because it has only one member.]

(2) A company registered under the [1862 c. 89] Companies Act 1862, the [1908 c. 69] Companies (Consolidation) Act 1908, the [1932 c. 7(N.I.)] Companies Act (Northern Ireland) 1932 or the Act of 1960 shall not register under this Article.

(3) A company having the liability of its members limited by a statutory provision or letters patent, and not being a joint stock company, shall not register under this Article.

(4) A company having the liability of its members limited by a statutory provision or letters patent shall not register under this Article as an unlimited company or as a company limited by guarantee.

(5) A company that is not a joint stock company shall not register under this Article as a company limited by shares.

F940 SR 1992/405

Procedural requirements for registration N.I.

630.—(1) A company shall not register under Article 629 without the assent of a majority of such of its members as are present in person or by proxy (in cases where proxies are allowed) at a general meeting summoned for the purpose.

(2) Where a company not having the liability of its members limited by a statutory provision or letters patent is about to register as a limited company, the majority required to assent as required by paragraph (1) shall consist of not less than three-fourths of the members present in person or by proxy at the meeting.

(3) In computing any majority under this Article when a poll is demanded, regard is to be had to the number of votes to which each member is entitled according to the company's regulations.

(4) Where a company is about to register (under Article 629) as a company limited by guarantee, the assent to its being so registered shall be accompanied by a resolution declaring that each member undertakes to contribute to the company's assets, in the event of its being wound up, while he is a member, or within one year after he ceases to be a member, for payment of the company's debts and liabilities contracted before he ceased to be a member, and of the costs and expenses of winding up and for the adjustment of the rights of the contributories among themselves, such amount as may be required, not exceeding a specified amount.

(5) Before a company is registered under Article 629, is shall deliver to the registrar a statement in the prescribed form—

(a) that the registered office of the company is to be situated in Northern Ireland, and

(b) specifying the intended situation of the company's registered office after registration.

Change of name on registration N.I.

631.—(1) Where the name of a company seeking registration under Article 629 is a name by which it is precluded from registration by Article 36, either because it falls within paragraph (1) of that Article or, if it falls within paragraph (2) of that Article, because the Department would not approve the company being registered with that name, the company may change its name with effect from the date on which it is registered under this Chapter.

(2) A change of name under this Article requires the like assent of the company's members as is required by Article 630 for registration.

Definition of “joint stock company” N.I.

632.—(1) For the purposes of this Chapter as far as relates to registration of companies as companies limited by shares, “joint stock company” means a company—

(a) having a permanent paid-up or nominal share capital of fixed amount divided into shares, also of fixed amount, or held and transferable as stock, or divided and held partly in one way and partly in the other, and

(b) formed on the principle of having for its members the holders of those shares or that stock, and no other persons.

(2) Such a company when registered with limited liability under this Order is deemed a company limited by shares.

Requirements for registration by joint stock companies N.I.

633.—(1) Before the registration under Article 629 of a joint stock company, there shall be delivered to the registrar the following documents—

(a) a statement in the prescribed form specifying the name with which the company is proposed to be registered;

(b) a list in the prescribed form showing the names and addresses of all persons who on a day named in the list[F941 not more than 28 clear days before the day of registration] were members of the company, with the addition of the shares or stock held by them respectively (distinguishing in cases, where the shares are numbered, each share by its number), and

(c) a copy of any statutory provision, royal charter, letters patent, deed of settlement, contract of copartnery, or other instrument constituting or regulating the company.

(2) If the company is intended to be registered as a limited company, there shall also be delivered to the registrar a statement in the prescribed form specifying the following particulars—

(a) the nominal share capital of the company and the number of shares into which it is divided, or the amount of stock of which it consists, and

(b) the number of shares taken and the amount paid on each share.

F941 1990 NI 10

Registration of joint stock company as public company N.I.

634.—(1) A joint stock company applying to be registered under Article 629 as a company limited by shares may, subject to—

(a) satisfying the conditions set out in Article 54(2)(a) and (b) (where applicable) and Article 55(2) to (4) as applied by this Article, and

(b) complying with paragraph (4),

apply to be so registered as a public company.

(2) Articles 54 and 55 apply for this purpose as in the case of a private company applying to be re-registered under Article 53, but as if a reference to the special resolution required by Article 53 were to the joint stock company's resolution that it be a public company.

(3) The resolution may change the company's name by deleting the word “company” or the words “and company”, including any abbreviation of them.

(4) The joint stock company's application shall be made in the form prescribed for the purpose, and shall be delivered to the registrar together with the following documents (as well as those required by Article 633), namely—

(a) a copy of the resolution that the company be a public company,

(b) a copy of a written statement by an accountant with the appropriate qualifications that in his opinion a relevant balance sheet shows that at the balance sheet date the amount of the company's net assets was not less than the aggregate of its called-up share capital and undistributable reserves,

(c) a copy of the relevant balance sheet, together with a copy of an unqualified report (by an accountant with such qualifications) in relation to that balance sheet,

(d) a copy of any valuation report prepared under Article 54(2)(b) as applied by this Article, and

(e) [F942 subject to paragraph (4A),] a statutory declaration in the prescribed form by a director or secretary of the company—

(i) that the conditions set out in Article 54(2)(a) and (b) (where applicable) and Article 55(2) to (4) have been satisfied, and

(ii) that, between the balance sheet date referred to in sub-paragraph (b) and the joint stock company's application, there has been no change in the company's financial position that has resulted in the amount of its net assets becoming less than the aggregate of its called-up share capital and undistributable reserves.

[F942 (4A) In place of the statutory declaration referred to in sub-paragraph (e) of paragraph (4), there may be delivered to the registrar using electronic communications a statement made by a director or secretary of the company as to the matters set out in heads (i) and (ii) of that sub-paragraph.]

(5) The registrar may accept a declaration under paragraph (4)(e)[F942 or statement under paragraph (4A)] as sufficient evidence that the conditions referred to in that paragraph have been satisfied.

(6) In this Article—

• “accountant with the appropriate qualifications” means[F943 a person who would be eligible] for appointment as the company's auditor, if it were a company registered under this Order,

• “relevant balance sheet” means a balance sheet prepared as at a date not more than 7 months before the joint stock company's application to be registered as a public company limited by shares, and

• “undistributable reserves” has the meaning gives by Article 272(3);

• and Article 56 applies (with the necessary modifications) for the interpretation of the reference in paragraph (4)(c) to an unqualified report by the accountant.

[F942 (7) Any person who makes a false statement under paragraph (4A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

F942 SR 2003/3

F943 SR 1993/67

Other requirements for registration N.I.

635.—(1) Before the registration in pursuance of this Chapter of any company (not being a joint stock company), there shall be delivered to the registrar—

(a) a statement in the prescribed form specifying the name with which the company is proposed to be registered,

[F944 (b) a list showing with respect to each director or manager of the company—

(i) in the case of an individual, his name, address, occupation and date of birth,

(ii) in the case of a corporation or Scottish firm, its corporate or firm name and registered or principal office,]

(c) a copy of any statutory provision, letters patent, deed of settlement, contract of copartnery, or other instrument constituting or regulating the company, and

(d) in the case of a company intended to be registered as a company limited by guarantee, a copy of the resolution declaring the amount of the guarantee.

[F944 (1A) For the purposes of paragraph (1)(b)(i) a person's “name” means his Christian name (or other forename) and surname, except that in the case of a peer, or an individual usually known by a title, the title may be stated instead of his Christian name (or other forename) and surname or in addition to either or both of them.]

(2) [F945 Subject to paragraph (2A), the lists] of members and directors and any other particulars relating to the company which are required by this Chapter to be delivered to the registrar shall be verified by a statutory declaration in the prescribed form made by any 2 or more directors or other principal officers of the company.

[F945 (2A) In place of the statutory declaration referred to in paragraph (2), there may be delivered to the registrar using electronic communications a statement made by any two or more directors or other principal officers of the company verifying the matters set out in that paragraph.]

(3) The registrar may require such evidence as he thinks necessary for the purpose of satisfying himself whether a company proposing to be registered is or is not a joint stock company as defined by Article 632.

[F945 (4) Any person who makes a false statement under paragraph (2A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]

F944 1990 NI 10

F945 SR 2003/3

Name of company registering N.I.

636.—(1) This Article applies with respect to a company registering under this Chapter (whether a joint stock company or not).

(2) If the company is to be registered as a public company, its name must end with the words “public limited company”; and those words may not be preceded by the words “limited”.

(3) In the case of a company limited by shares or by guarantee (not being a public company), the name must have “limited” as its last word' but this is subject to Article 40 (exempting a company, in certain circumstances, from having “limited” as part of its name).

(4) If the company is registered with limited liability, then any additions to the company's name set out in the statements delivered under Article 633(1)(a) or 635(1)(a) shall form and be registered as the last part of the company's name.

Certificate of registration under this Chapter N.I.

637.—(1) On compliance with the requirements of this Chapter with respect to registration, the registrar shall certify under his hand that the company applying for registration is incorporated as a company under this Order and, in the case of a limited company, that it is limited.

(2) On the issue of the certificate, the company shall be so incorporated.

(3) The certificate is conclusive evidence that the requirements of this Chapter in respect of registration, and of matters precedent and incidental to it, have been complied with.

(4) Where on an application by a joint stock company to register as a public company limited by shares the registrar is satisfied that the company may be registered as a public company so limited, the certificate of incorporation given under this Article shall state that the company is a public company; and that statement is conclusive evidence that the requirements of Article 634 have been complied with and that the company is a public company so limited.

Effect of registration N.I.

638.  Schedule 20 has effect with respect to the consequences of registration under this Chapter, the vesting of property, savings for existing liabilities, continuation of existing actions, status of the company following registration, and other connected matters.

Power to substitute memorandum and articles for deed of settlement N.I.

639.—(1) Subject as follows, a company registered in pursuance of this Chapter may by special resolution alter the form of its constitution by substituting a memorandum and articles for a deed of settlement.

(2) The provisions of Articles 15 to 17 with respect to applications to the court for cancellation of alterations of the objects of a company and matters consequential on the passing of resolutions for such alterations (so far as applicable) apply, but with the following modifications—

(a) there is substituted for the printed copy of the altered memorandum required to be delivered to the registrar a printed copy of the substituted memorandum and articles, and

(b) on the delivery to the registrar of the substituted memorandum and articles or the date when the alteration is no longer liable to be cancelled by order of the court (whichever is the later)—

(i) the substituted memorandum and articles apply to the company in the same manner as if it were a company registered under Part II with that memorandum and those articles, and

(ii) the company's deed of settlement ceases to apply to the company.

(3) An alteration under this Article may be made either with or without alteration of the company's objects.

(4) In this Article “deed of settlement” includes any contract of copartnery or other instrument constituting or regulating the company, not being a statutory provision, a royal charter or letters patent.

PART XXIIIF1029 N.I. COMPANIES INCORPORATED OUTSIDE NORTHERN IRELAND CARRYING ON BUSINESS IN NORTHERN IRELAND

CHAPTER IF1029 N.I. REGISTRATION, ETC.

Application of this Part N.I.

640.—(1) This Part applies to—

(a) a company incorporated outside Northern Ireland which after the commencement of this Order, establishes a place of business in Northern Ireland, and

(b) a company so incorporated which has, before the commencement of this Order, established a place of business in Northern Ireland and continues to have an established place of business in Northern Ireland at the commencement of this Order.

(2) A company to which this Part applies is in this Order referred to as a “Part XXIII company”.

[F946 Branch registration under the Eleventh Company Law Directive (89/666/EEC) N.I.

640A.— (1) This Article applies to any limited company which—

(a) is incorporated outside the United Kingdom and Gibraltar, and

(b) has a branch in Northern Ireland.

(2) Schedule 20A (branch registration under the Eleventh Company Law Directive (89/666/EEC) shall have effect in relation to any company to which this Article applies.]

F946 SR 1993/198

[F947 Scope of Articles 641 and 642 N.I.

640B.   Article 641 and 642 shall not apply to any limited company which—

(a) is incorporated outside the United Kingdom and Gibraltar, and

(b) has a branch in the United Kingdom.]

F947 SR 1993/198

Documents to be delivered to registrar N.I.

641.—(1) When a company incorporated outside Northern Ireland establishes a place of business in Northern Ireland, it shall within one month of doing so deliver to the registrar for registration—

(a) a certified copy of the charter, statutes or memorandum and articles of the company or other instrument constituting or defining the company's constitution, and, if the instrument is not written in the English language, a certified translation of it; and

(b) a return in the prescribed form containing—

(i) a list of the company's directors and secretary, containing the particulars specified in paragraph (2),

(ii) a list of the names and addresses of some one or more persons resident in Northern Ireland authorised to accept on the company's behalf service of process and any notices required to be served on it,

(iii) a list of the documents delivered in compliance with sub-paragraph (a), and

(iv) [F948 subject to paragraph (3A),] a statutory declaration (made by a director or secretary of the company or by any person whose name and address are given in the list required by head (ii)), stating the date on which the company's place of business in Northern Ireland was established.

[F949 (2) The list referred to in paragraph (1)(b)(i) shall contain the following particulars with respect to each director—

(a) in the case of an individual—

(i) his name,

(ii) any former name,

(iii) his usual residential address,

(iv) his nationality,

(v) his business occupation (if any),

(vi) if he has no business occupation but holds other directorships, particulars of them, and

(vii) his date of birth;

(b) in the case of a corporation or Scottish firm, its corporate or firm name and registered or principal office.

(3) The list referred to in paragraph (1)(b)(i) shall contain the following particulars with respect to the secretary (or, where there are joint secretaries, with respect to each of them)—

(a) in the case of an individual, his name, any former name and his usual residential address;

(b) in the case of a corporation or Scottish firm, its corporate or firm name and registered or principal office.

Where all the partners in a firm are joint secretaries of the company, the name and principal office of the firm may be stated instead of the particulars required by sub-paragraph (a).

[F948 (3A) In place of the statutory declaration referred to in head (iv) of sub-paragraph (b) of paragraph (1), there may be delivered to the registrar using electronic communications a statement made by any person by whom the declaration could have been made stating the date on which the company's place of business in Northern Ireland was established.]

(4) In paragraphs (2)(a) and (3)(a)—

(a) “name” means a person's Christian name (or other forename) and surname, except that in case of a peer, or an individual usually known by a title, the title may be stated instead of his Christian name (or other forename) and surname, or in addition to either or both of them; and

(b) the reference to a former name does not include—

(i) in the case of a peer, or an individual normally known by a British title, the name by which he was known previous to the adoption of or succession to the title, or

(ii) in the case of any person, a former name which was changed or disused before he attained the age of 18 years or which has been changed or disused for 20 years or more, or

(iii) in the case of a married woman, the name by which she was known previous to the marriage.

[F948 (5) Any person who makes a false statement under paragraph (3A) which he knows to be false or does not believe to be true is liable to imprisonment or a fine, or both.]]

F948 SR 2003/3

F949 1990 NI 10

Registration of altered particulars N.I.

642.—(1) If any alteration is made in—

(a) the charter, statutes, or memorandum and articles of a Part XXIII company or any such instrument as is mentioned in Article 641, or

(b) the directors or secretary of a Part XXIII company or the particulars contained in the list of the directors and secretary, or

(c) the names or addresses of the persons authorised to accept service on behalf of a Part XXIII company,

the company shall, within the time specified in paragraph (3), deliver to the registrar for registration a return containing the prescribed particulars of the alteration.

(2) If any change is made in the corporate name of a Part XXIII company, the company shall within the time specified in paragraph (3) deliver to the registrar for registration a return containing the prescribed particulars of the change.

(3) The time for delivery of the returns required by paragraphs (1) and (2) is—

(a) in the case of an alteration to which paragraph (1)(c) applies, 21 days after the making of the alteration, and

(b) otherwise, 21 days after the date on which notice of the alteration or change in question could have been received in Northern Ireland in due course of post (if despatched with due diligence).

[F950 Change in registration regime N.I.

642A.— (1) Where a company ceases to be a company to which Article 640A applies and, immediately after ceasing to be such a company—

(a) continues to have in Northern Ireland a place of business which it had immediately before ceasing to be such a company, and

(b) does not have a branch in Great Britain,

it shall be treated for the purposes of Article 641 as having established the place of business on the date when it ceased to be a company to which Article 640A applies.

(2) Where a limited company incorporated outside the United Kingdom and Gibraltar—

(a) ceases to have a branch in Great Britain, and

(b) both immediately before and immediately after ceasing to do so, has a place of business, but not a branch, in Northern Ireland,

it shall be treated for the purposes of Article 641 as having established the place of business on the date when it ceased to have a branch in Great Britain.

(3) Schedule 20B (transitional provisions in relation to change in registration regime) shall have effect.]

F950 SR 1993/198

Obligation to state name and other particulars N.I.

643.—(1 )F951  Every Part XXIII company shall—

Sub‐para. (a) rep. by 1986 c. 60

(b) conspicuously exhibit on every place where it carries on business in Northern Ireland the company's name and the country in which it is incorporated.

(c) cause the company's name and the country in which it is incorporated to be stated in legible characters in all bill-heads and letter paper, and in all notices and other official publications of the company,

(d) if the liability of the members of the company is limited, cause notice of that fact to be stated in legible charactersF952 . . . in all bill-heads, letter paper, notices and other official publications of the company in Northern Ireland, and to be affixed on every place where it carries on its business.

(2) Paragraph (1)(b) and (c) does not apply to a company incorporated in Great Britain.

[F953 (3 )F951  Every company to which Article 640A applies shall, in the case of each branch of the company registered under paragraph 1 of Schedule 20A, cause the following particulars to be stated in legible characters in all letter paper and order forms used in carrying on the business of the branch—

(a) the place of registration of the branch, and

(b) the registered number of the branch.

(4 )F951  Every company to which Article 640A applies, which is not incorporated in a Member State and which is required by the law of the country in which it is incorporated to be registered under paragraph 1 of Schedule 20A, cause the following particulars to be stated in legible characters in all letter paper and order forms used in carrying on the business of the branch—

(a) the identity of the registry in which the company is registered in its country of incorporation, and

(b) the number with which it is registered.

(5 )F951  Every company to which Article 640A applies and which is not incorporated in a Member State shall, in the case of each branch of the company registered under paragraph 1 of Schedule 20A, cause the following particulars to be stated in legible character in all letter paper and order forms used in carrying on the business of the branch—

(a) the legal form of the company,

(b) the location of its head office,

(c) if applicable, the fact that it is being wound up.]

F951 mod. by SR 2004/307

F952 1986 c. 60

F953 SR 1993/198

Regulation of Part XXIII companies in respect of their names N.I.

644.—(1) If it appears to the Department that the corporate name of a Part XXIII company is a name by which the company, had it been formed under this Order, would on the relevant date [F954 (determined in accordance with paragraphs (3A) and (3B))] have been precluded from being registered by Article 36 either—

(a) because it falls within paragraph (1) of that Article, or

(b) if it falls within paragraph (2) of that Article, because the Department would not approve the company's being registered by that name,

the Department may serve a notice on the company, stating why the name would not have been registered.

(2) If the corporate name of a Part XXIII company is in the Department's opinion too like a name appearing on the relevant date in the index of names kept by the registrar under Article 663 or which should have appeared in that index on that date, or is the same as a name which should have so appeared, the Department may serve a notice on the company specifying the name in the index which the company's name is too like or which is the same as the company's name.

(3) No notice shall be served on a company under paragraph (1) or (2) later than 12 months after the relevant date,F954 . . .

[F954 (3A) For the purposes of paragraphs (1) to (3), the relevant date, in relation to a company, is the date on which it has complied with paragraph 1 of Schedule 20A or Article 641(1) or, if there is more than one such date, the first date on which it has complied with either of those provisions since becoming a Part XXIII company.

(3B) But where the company's corporate name has changed since the date ascertained in accordance with paragraph (3A), the relevant date is the date on which the company has, in respect of the change or, if more than one, the latest change, complied with paragraph 7(1) of Schedule 20A or Article 642(2), as the case may be.]

(4) A Part XXIII company on which a notice is served under paragraph (1) or (2)—

(a) may deliver to the registrar for registration a statement in the prescribed form specifying a name approved by the Department other than its corporate name under which it proposes to carry on business in Northern Ireland, and

(b) may, after that name has been registered, at any time deliver to the registrar for registration a statement in the prescribed form specifying a name approved by the Department (other than its corporate name) in substitution for the name previously registered.

(5) The name by which a Part XXIII company is for the time being registered under paragraph (4) is, for all purposes of the law applying in Northern Ireland (including this Order and the [1986 NI 7] Business (Northern Ireland) Order 1986), deemed to be the company's corporate name; but—

(a) this does not affect references to the corporate name in this Article, or any rights or obligations of the company, or render defective any legal proceedings by or against the company, and

(b) any legal proceedings that might have been continued or commenced against the company by its corporate name or its name previously registered under this Article may be continued or commenced against it by its name for the time being so registered.

(6) A Part XXIII company on which a notice is served under paragraph (1) or (2) shall not at any time after the expiration of 2 months from the service of that notice (or such longer period as may be specified in that notice) carry on business in Northern Ireland under its corporate name.

Nothing in this paragraph, or in Article 647(2) (which imposes penalties for its contravention) invalidates any transaction entered into by the company.

(7) The Department may withdraw a notice served under paragraph (1) or (2) at any time before the end of the period mentioned in paragraph (6); and that paragraph does not apply to a company served with a notice which has been withdrawn.

F954 SR 1993/198

Service of documents: companies to which Article 640A applies N.I.

644A.—(1) This Article applies to any company to which Article 640A applies.

(2) Any process or notice required to be served on a company to which this Article applies in respect of the carrying on of the business of a branch registered by it under paragraph 1 of Schedule 20A is sufficiently served if—

(a) addressed to any person whose name has, in respect of the branch, been delivered to the registrar as a person falling within paragraph 3(e) of that Schedule, and

(b) left at or sent by post to the address for that person which has been so delivered.

(3) Where—

(a) a company to which this Article applies makes default, in respect of a branch, in delivering to the registrar the particulars mentioned in paragraph 3(e) of Schedule 20A, or

(b) all the persons whose names have, in respect of a branch, been delivered to the registrar under paragraph 1 of that Schedule as persons falling within paragraph 3(e) are dead or have ceased to reside in Northern Ireland, or refuse to accept service on the company's behalf, or for any reason cannot be served,

a document may be served on the company in respect of the carrying on of the business of the branch by leaving it at, or sending it by post to, any place of business established by the company in Northern Ireland.

(4) Where a company to which this Article applies has more than one branch in Northern Ireland, any notice or process required to be served on the company which is not required to be served in respect of the carrying on of the business of one branch rather than another shall be treated for the purposes of this Article as required to be served in respect of the carrying on of the business of each of its branches.

Service of documents on a Part XXIII company N.I.

645.—(1) Any process or notice required to be served on a Part XXIII company [F955 to which Article 641 applies] is sufficiently served if addressed to any person whose name has been delivered to the registrar under the foregoing provisions of this Part and left at or sent by post to the address which has been so delivered.

(2) However—

(a) where such a company makes default in delivering to the registrar the name and address of a person resident in Northern Ireland who is authorised to accept on behalf of the company service of process or notices, or

(b) if at any time all the persons whose names and addresses have been so delivered are dead or have ceased so to reside, or refuse to accept service on the company's behalf, or for any reason cannot be served,

a document may be served on the company by leaving it at, or sending it by post to, any place of business established by the company in Northern Ireland.

F955 SR 1993/198

Documents to be filed on cessation of business: companies to which Article 640A applies N.I.

645A.  If a company to which Article 640A applies closes a branch in Northern Ireland, it shall forthwith give notice of that fact to the registrar; and from the date on which notice is so given it is no longer obliged to deliver documents to the registrar in respect of that branch.

Documents to be filed on cessation of business N.I.

646.  If a Part XXIII company [F956 to which Article 641 applies] ceases to have a place of business in Northern Ireland, it shall forthwith give notice of that fact to the registrar; and as from the date on which notice is so given the obligation of the company to deliver any document to the registrar ceases.

F956 SR 1993/198

Penalties for non-compliance N.I.

647.—(1) If a Part XXIII company fails to comply with any of Articles 641 to 643 and 646 the company, and every officer or agent of the company who knowingly and wilfully authorises or permits the default, is liable to a fine and, in the case of a continuing offence, to a daily default fine for continued contravention.

(2) If a Part XXIII company contravenes Article 644(6), the company and every officer or agent of it who knowingly and wilfully authorises or permits the contravention is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

[F957 (3) If a Part XXIII company fails to comply with Article 645A or Schedule 20A, the company and every officer or agent of the company who knowingly and wilfully authorises or permits the default is liable to a fine, and in the case of a continuing offence, to a daily default fine for continued contravention.]

F957 SR 1993/198

Interpretation F958 . . . N.I.

648.— [F958 (1)] For the purposes of this Chapter—

• “certified” means certified in the prescribed manner to be a true copy or a correct translation;

• “director”, in relation to a Part XXIII company, includes a shadow director; and

• “secretary” includes any person occupying the position of secretary by whatever name called.

[F958 (2) For the purposes of this Part (except Article 648A and Schedule 20C):

(a) where a branch comprises places of business in more than one part of the United Kingdom the branch shall be treated as being situated in that part of the United Kingdom where its principal place of business is situated; and

(b) “branch” means a branch within the meaning of the Council Directive concerning disclosure requirements in respect of branches opened in a Member State by certain types of company governed by the law of another State (the Eleventh Company Law Directive, 89/666/EEC).]

F958 SR 1993/198

[F959 CHAPTER II]F1029 N.I. [F959 DELIVERY OF ACCOUNTS AND REPORTS]

F959 1990 NI 5

[F960 Credit and financial institutions to which the Bank Branches Directive (89/117/EEC) applies N.I.

648A.— (1) This Article applies to any credit or financial institution—

(a) which is incorporated or otherwise formed outside the United Kingdom and Gibraltar,

(b) whose head office is outside the United Kingdom and Gibraltar, and

(c) which has a branch in Northern Ireland.

(2) Schedule 20C (delivery of accounts and reports) shall have effect in relation to any institution to which this Article applies.

(3) In this Article—

• “branch,” in relation to a credit or financial institution, means a place of business which forms a legally dependent part of the institution and which conducts directly all or some of the operations inherent in its business;

• “credit institution” means a credit institution as defined in Article 1 of the First Council Directive on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions (77/780/EEC), that is to say an undertaking whose business is to receive deposits or other repayable funds from the public and to grant credits for its own account;

• “financial institution” means a financial institution within the meaning of Article 1 of the Council Directive on the obligations of branches established in a Member State of credit and financial institutions having their head offices outside that Member State regarding the publication of annual accounting documents (the Bank Branches Directive, 89/117/EEC); and

• “undertaking” has the same meaning is in Part VIII.]

F960 SR 1993/198, reg. 2(1)

[F961 Companies to which the Eleventh Company Law Directive applies N.I.

648AA.— (1) This Article applies to any limited company which—

(a) is incorporated outside the United Kingdom and Gibraltar,

(b) has a branch in Northern Ireland, and

(c) is not an institution to which Article 648A applies.

(2) Schedule 20D (delivery of accounts and reports) shall have effect in relation to any company to which this Article applies.]

F961 SR 1993/198, reg. 15

[F962 Scope of Articles 649 to 652 N.I.

648B.   Articles 649 to 652 shall not apply to any institution to which Article 648A applies[F963 or to any limited company which is incorporated outside the United Kingdom and Gibraltar and has a branch in the United Kingdom].]

F962 SR 1993/198, reg. 2(1)

F963 SR 1993/198

Preparation of accounts and reports by Part XXIII companies N.I.

649.—(1) Every Part XXIII company shall in respect in each financial year of the company prepare the like accounts and directors' report, and cause to be prepared such an auditors' report, as would be required if the company were formed and registered under this Order.

(2) The Department may by order—

(a) modify the requirements referred to in paragraph (1) for the purpose of their application to Part XXIII companies;

(b) exempt a Part XXIII company from those requirements or from such of them as may be specified in the order.

(3) An order may contain such incidental and supplementary provisions as the Department thinks fit.

(4) An order under this Article shall be subject to negative resolution.

Part XXIII company's financial year and accounting reference periods N.I.

650.—(1) Articles 231 to 233 (financial year and accounting reference periods) apply to a Part XXIII company, subject to the following modifications.

(2) For the references to the incorporation of the company substitute references to the company establishing a place of business in Northern Ireland.

(3) Omit Article 233(4) (restriction on frequency with which current accounting reference period may be extended).

Delivery to registrar of accounts and reports of Part XXIII company N.I.

651.—(1) A Part XXIII company shall in respect of each financial year of the company deliver to the registrar copies of the accounts and reports prepared in accordance with Article 649.

If any document comprised in those accounts or reports is in a language other than English, the directors shall annex to the copy delivered a translation of it into English, certified in the prescribed manner to be a correct translation.

(2) In relation to a Part XXIII company the period allowed for delivering accounts and reports is 13 months after the end of the relevant accounting reference period.

This is subject to the following provisions of this Article.

(3) If the relevant accounting reference period is the company's first and is a period of more than 12 months, the period allowed is 13 months from the first anniversary of the company's establishing a place of business in Northern Ireland.

(4) If the relevant accounting period is treated as shortened by virtue of a notice given by the company under Article 233 (alteration of accounting reference date), the period allowed is that applicable in accordance with the above provisions or 3 months from the date of the notice under that Article, whichever last expires.

(5) If for any special reason the Department thinks fit it may, on an application made before the expiry of the period otherwise allowed, by notice in writing to a Part XXIII company extend that period by such further period as may be specified in the notice.

(6) In this Article “the relevant accounting reference period” means the accounting reference period by reference to which the financial year for the accounts in question was determined.

Penalty for non-compliance N.I.

652.—(1) If the requirements of Article 651(1) are complied with before the end of the period allowed for delivering accounts and reports, or if the accounts and reports delivered do not comply with the requirements of this Order, the company and every person who immediately before the end of that period was a director of the company is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(2) It is defence for a person charged with such an offence to prove that he took all reasonable steps for securing that the requirements in question would be complied with.

(3) It is not a defence in relation to a failure to deliver copies to the registrar to prove that the documents in question were not in fact prepared as required by this Order.

F964 prosp. insertion by 1990 NI 10

Prospective

CHAPTER III F1029 N.I. REGISTRATION OF CHARGES

{prosp insertion of arts. 652A-652M by 1990 NI 10} N.I.

F965 prosp insertion of Chpt. III (arts. 652A-652M) by 1990 NI 10, arts. 28(b), 41, Sch. 1

[F966 CHAPTER IV]F1029 N.I. [F966 WINDING UP, ETC.]

F966 SR 1993/198

[F967 Scope of Chapter N.I.

652N.   This Chapter applies to any company to which Article 640A applies.]

F967 SR 1993/198

[F968 Particulars to be delivered to the registrar: winding up N.I.

652O.— (1) Subject to paragraph (8), where a company to which this Chapter applies is being wound up, it shall deliver to the registrar for registration a return in the prescribed form containing the following particulars—

(a) the name of the company;

(b) whether the company is being wound up by an order of a court and, if so, the name and address of the court and the date of the order;

(c) if the company is not being so wound up, as a result of what action the winding up has commenced;

(d) whether the winding up has been instigated by:

(i) the company's members;

(ii) the company's creditors; or

(iii) some other person or persons,

and, in the case of (iii) the identity of that person or those persons shall be given; and

(e) the date on which the winding up became or will become effective.

(2) The period allowed for delivery of a return under paragraph (1) is 14 days from the date on which the winding up begins.

(3) Subject to paragraph (8), a person appointed to be the liquidator of a company to which this Chapter applies shall deliver to the registrar for registration a return in the prescribed form containing the following particulars—

(a) his name and address,

(b) the date of his appointment, and

(c) a description of such of his powers, if any, as are derived otherwise than from the general law of the company's constitution.

(4) The period allowed for delivery of a return under paragraph (3) is 14 days from the date of the liquidator's appointment.

(5) Subject to paragraph (8), the liquidator of a company to which this Chapter applies shall deliver to the registrar for registration a return in the prescribed form upon the occurrence of the following events—

(a) the termination of the winding up of the company, and

(b) the company ceasing to be registered, in circumstances where ceasing to be registered is an event of legal significance.

The following particulars shall be given:

(i)

in the case of (a), the name of the company and the date on which the winding up terminated; and

(ii)

in the case of (b), the name of the company and the date on which the company ceased to be registered.

(6) The period allowed for delivery of a return under paragraph (5) is 14 days from the date of the event concerned.

(7) The obligation to deliver a return under paragraph (1), (3) or (5) shall apply in respect of each branch which the company has in Northern Ireland (though where the company has more than one branch in Northern Ireland a return which gives the branch numbers of two or more such branches is to be regarded as a return in respect of each branch whose number is given).

(8) No return is required under paragraph (1), (3) or (5) in respect of a winding up under Part VI of the Insolvency (Northern Ireland) Order 1989.]

F968 SR 1993/198

[F969 Particulars to be delivered to the registrar: insolvency proceedings etc. N.I.

652P.— (1) Where a company to which this Chapter applies becomes subject to any of the following proceedings (other than proceedings for the winding up of the company), that is to say, insolvency proceedings or an arrangement or composition or any analogous proceedings, it shall deliver to the registrar for registration a return in the prescribed form containing the following particulars—

(a) the name of the company;

(b) whether the proceedings are by order of a court and, if so, the name and address of the court and the date of the order;

(c) if the proceedings are not by order of a court, as a result of what action the proceedings have been commenced;

(d) whether the proceedings have been instigated by:

(i) the company's members;

(ii) the company's creditors; or

(iii) some other person or persons,

and, in the case of (iii) the identity of that person or those persons shall be given; and

(e) the date on which the proceedings became or will become effective.

(2) Where a company to which this Chapter applies ceases to be subject to any of the proceedings mentioned in paragraph (1) it shall deliver to the registrar for registration a return in the prescribed form containing the following particulars:

(a) the name of the company; and

(b) the date on which it ceased to be subject to the proceedings.

(3) The period allowed for delivery of a return under sub-paragraph (1) or (2) is 14 days from the date on which the company becomes subject to the proceedings concerned.

(4) The obligation to deliver a return under this Article shall apply in respect of each branch which the company has in Northern Ireland (though where the company has more than one branch in Northern Ireland a return which gives the branch number of two or more such branches is to be regarded as a return in respect of each branch whose number is given).]

F969 SR 1993/198

[F970 Penalty for non-compliance N.I.

652Q.— (1) If a company fails to comply with Article 652O(1) or 652P(1) or (2) within the period allowed for compliance, it, and every person who immediately before the end of that period was a director of it, is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(2) If a liquidator fails to comply with Article 652O(3) or (5) within the period allowed for compliance, he is guilty of an offence and liable to a fine and, for continued contravention, to a daily default fine.

(3) It is a defence for a person charged with an offence under this Article to prove that he took all reasonable steps for securing compliance with the requirements concerned.]

F970 SR 1993/198

PART XXIVF1029 N.I. THE REGISTRAR OF COMPANIES, HIS FUNCTIONS AND OFFICE

Registration office and registrar N.I.

653 .F971 —(1) For the purposes of the registration of companies under the Companies Orders, the Department shall continue to maintain and administer an office of the Department in Northern Ireland at such place as the Department thinks fit.

(2) The Department may for those purposes appoint an officer as registrar of companies and one or more than one officer as assistant registrar of companies.

(3) The Department may direct a seal or seals to be prepared for the authentication of documents required for or in connection with the registration of companies.

[F972 (4) Paragraph (5) applies where by virtue of Article 11(1) of the Deregulation and Contracting Out (Northern Ireland) Order 1996 a person is authorised by the registrar to accept delivery of any class of documents which are under any provision of the Companies Orders to be delivered to the registrar.

(5) If—

(a) the registrar directs that documents of that class shall be delivered to a specified address of the authorised person; and

(b) the direction is printed and made available to the public (with or without payment),

any document of that class which is delivered to an address other than the specified address shall be treated for the purposes of those Orders as not having been delivered.]

F971 mod. by SR 2004/307

F972 1996 NI 11

Companies' registered numbers N.I.

654.—(1) The registrar shall allocate to every company a number, which shall be known as the company's registered number.

(2) Companies' registered numbers shall be in such form, consisting of one or more sequences of figures or letters, as the registrar may from time to time determine.

(3) The registrar may upon adopting a new form of registered number make such changes of existing registered numbers as appear to him necessary.

(4) A change of a company's registered number has effect from the date on which the company is notified by the registrar of the change; but for a period of three years beginning with the date on which that notification is sent by the registrar the requirement of Article 359(1)(a) as to the use of the company's registered number on [F973 business letters, order forms and websites] is satisfied by the use of either the old number or the new.

(5 )F974  In this Article “company” includes—

[F975 (za) any Part XXIII company which has complied with paragraph 1 of Schedule 20A other than a company which appears to the registrar not to have a branch in Northern Ireland;]

(a) any Part XXIII company which has complied with Article 641 (delivery of statutes to registrar, &c.), other than a company which appears to the registrar not to have a place of business in Northern Ireland, and

(b) any body to which any provision of this Order applies by virtue of Article 667 (unregistered companies).

F973 Words in art. 654(4) substituted (1.1.2007) by Companies (Registrar, Languages and Trading Disclosures) Regulations 2006 (S.I. 2006/3429), reg. 6(2), Sch. 2 para. 3

F974 mod. by SR 2004/307

F975 SR 1993/198

Registration of branches of Part XXIII companies N.I.

654A.—(1) For each company to which Article 640A applies the registrar shall keep, in such form as he thinks fit, a register of the branches registered by the company under paragraph 1 of Schedule 20A.

(2) The registrar shall allocate to every branch registered by him under this Article a number, which shall be known as the branch's registered number.

(3) Branches' registered numbers shall be in such form, consisting of one or more sequences of figures or letters, as the registrar may from time to time determine.

(4) The registrar may upon adopting a new form of registered number make such changes of existing registered numbers as appear to him necessary.

(5) A change of a branch's registered number has effect from the date on which the company is notified by the registrar of the change; but for a period of three years beginning with the date on which that notification is sent by the registrar the requirement of Article 643(3) as to the use of the branch's registered number on business letters and order forms is satisfied by the use of either the old number or the new.

(6) Where a Part XXIII company to which Article 640A applies files particulars, in any circumstances permitted by this Order, by:

(a) adopting particulars already filed in respect of another branch; or

(b) including in one document particulars which are to relate to two or more branches,

the registrar shall ensure that the particulars concerned become part of the registered particulars of each branch concerned.

[F976 Delivery to the registar of documents in legible form N.I.

655.— (1) This Article applies to the delivery to the registrar under any provision of the Companies Orders of documents in legible form.

(2) The document must—

(a )F977 state in a prominent position the registered number of the company to which it relates,[F978 and, if the document is delivered under Article 645A, 652O or 652P or Schedule 20A or 20D, the registered number of the branch to which it relates,]

(b) satisfy any requirements prescribed by regulations for the purposes of this Article, and

(c) conform to such requirements as the registrar may specify for the purpose of enabling him to copy the document.

(3) If a document is delivered to the registrar which does not comply with the requirements of this Article, he may serve on the person by whom the document was delivered (or, if there are two or more such persons, on any of them) a notice indicating the respect in which the document does not comply.

(4) Where the registrar serves such a notice, then, unless a replacement document—

(a) is delivered to him within 14 days after the service of the notice, and

(b) complies with the requirements of this Article (or Article[F979 656B]) or is not rejected by him for failure to comply with those requirements,

the original document shall be deemed not to have been delivered to him.

But for the purposes of any statutory provision imposing a penalty for failure to deliver, so far as it imposes a penalty for continued contravention, no account shall be taken of the period between the delivery of the original document and the end of the period of 14 days after service of the registrar's notice.]

F976 Art. 655 substituted by 1990 NI 10, art. 59(1)

F977 mod. by SR 2004/307

F978 SR 1993/198

F979 SR 2003/3

Art. 656 rep. by SR 2003/3

The keeping of company records by the registrar N.I.

656A.— [F980 (1) The information contained in a document delivered to the registrar under the Companies Orders may be recorded and kept by him in any form he thinks fit, provided it is possible to inspect the information and to produce a copy of it in legible form.

This is sufficient compliance with any duty of his to keep, file or register the document.

(2) The originals of documents delivered to the registrar in legible form shall be kept by him for ten years, after which they may be destroyed.

(3) Where a company has been dissolved, the registrar may, at any time after the expiration of two years from the date of the dissolution, direct that any records in his custody relating to the company may be removed to the Public Record Office of Northern Ireland; and records in respect of which such a direction is given shall be disposed of in accordance with the statutory provisions relating to that Office.

(4 )F981  In paragraph (3) “company” includes a company provisionally or completely registered under the Joint Stock Companies Act 1844.]

F980 Art. 656A repealed (1.1.2007 for certain purposes, otherwise prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(a), Sch. 2 Pt. 2 (with arts. 6, 8, Sch. 5)

F981 mod. by SR 2004/307

Delivery to the registrar using electronic communications N.I.

656B.—(1) Electronic communications may be used for the delivery of any document to the registrar under any provision of the Companies Orders (including delivery of a document in the prescribed form), provided that such delivery is in such form and manner as is directed by the registrar.

(2) Where the document is required under any provision of the Companies Orders to be signed or sealed, it shall instead be authenticated in such manner as is directed by the registrar.

(3) The document must contain in a prominent position—

(a )F982 the name and registered number of the company to which it relates, or

(b )F982 if the document is delivered under Part XXIII, the registered number of the branch or place of business of the company to which it relates.

(4) If a document is delivered to the registrar which does not comply with the requirements imposed by or under this Article, he may serve on the person by whom the document was delivered (or, if there are two or more such persons, on any of them) a notice indicating the respect in which the document does not comply.

(5) Where the registrar serves such a notice, then unless a replacement document—

(a) is delivered to him within 14 days after the service of the notice, and

(b) complies with the requirements of this Article (or Article 655) or is not rejected by him for failure to comply with those requirements,

the original document shall be deemed not to have been delivered to him.

But for the purposes of any statutory provision imposing a penalty for failure to deliver, so far as it imposes a penalty for continued contravention, no account shall be taken of the period between the delivery of the original document and the end of the period of 14 days after service of the registrar's notice.

(6) In this Article references to the delivery of a document include references to the forwarding, lodging, registering, sending or submission of a document and to the giving of a notice.

F982 mod. by SR 2004/307

Fees payable to registrar N.I.

657 .F983 —(1) The Department may by regulations require the payment to the registrar of such fees as may be specified in the regulations in respect of—

(a) the performance by the registrar of such functions under the Companies Orders as may be so specified, including the receipt by him of[F984 any document which under those Orders is required to be delivered to him];

(b) the inspection of documentsF984 . . . kept by him under those Orders.

(2) Regulations made under paragraph (1)(a) requiring the payment of a fee in respect of a matter for which no fee was previously payable or increasing a fee shall be subject to affirmative resolution.

(3) Fees paid to the registrar under the Companies Orders shall be[F985 paid into the Consolidated Fund].

(4) It is hereby declared that the registrar may charge a fee for any services provided by him otherwise than in pursuance of any obligation imposed on him by law.

F983 mod. by SR 2004/307

F984 1990 NI 10

F985 1993 NI 5

Inspection, &c. of records kept by the registrar N.I.

658.  F986 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F986 Art. 658 repealed (1.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(a), Sch. 2 Pt. 2 (with arts. 6, 8, Sch. 5)

F987 Certificate of incorporation N.I.

659 .F988   Any person may require a certificate of the incorporation of a company, signed by the registrar or authenticated by his official seal.

F987 subst. by 1990 NI 10, art. 60(2)

F988 mod. by SR 2004/307

F989 Provision and authentication by registrar of documents is non-legible form N.I.

659A .F990 —(1) Any requirement of the Companies Orders as to the supply by the registrar of a document may, if the registrar thinks fit, be satisfied by the communication by the registrar of the requisite information in any non-legible form prescribed for the purposes of this Article by regulations or approved by him.

(2) Where the document is required to be signed by him or sealed with his official seal, it shall instead be authenticated in such manner as may be prescribed by regulations or approved by the registrar.

F989 1990 NI 10, art. 60(2)

F990 mod. by SR 2004/307

Public notice by registrar of receipt or issue of certain documents N.I.

660.  F991 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F991 Art. 660 repealed (1.1.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, art. 7(a), Sch. 2 Pt. 2 (with arts. 6, 8, Sch. 5)

Art. 661 rep. by 1990 NI 10

Enforcement of company's duty to make returns N.I.

662.—(1 )F992  If a company, having made default in complying with any provision of the Companies Orders which requires it to[F993 deliver a document to the registrar], or to give notice to him of any matter, fails to make good the default within 14 days after the service of a notice on the company requiring it to do so, the court may, on an application made to it by any member or creditor of the company or by the registrar, make an order directing the company and any officer of it to make good the default within such time as may be specified in the order.

(2 )F992  The court's order may provide that all costs of and incidental to the application shall be borne by the company or by any officers of it responsible for the default.

(3 )F992  Nothing in this Article prejudices the operation of any statutory provision imposing penalties on a company or its officers in respect of any such default as is mentioned in paragraph (1).

F992 mod. by SR 2004/307

F993 1990 NI 10

Modifications etc. (not altering text)

C12 Art. 662 applied (temp.) (15.12.2007) by Companies (Cross-Border Mergers) Regulations 2007 (S.I. 2007/2974), reg. 4, Sch. 1 para. 2

Registrar's index of company and corporate names N.I.

663 .F994 —(1) The registrar shall keep an index of the names of the following bodies—

(a) companies as defined by this Order,

[F995 (aa) companies incorporated outside the United Kingdon and Gibraltar which have complied with paragraph 1 of Schedule 20A and which do not appear to the registrar not to have a branch in Northern Ireland,]

(b) companies incorporated outside Northern Ireland which have complied with Article 641 and which do not appear to the registrar not to have a place of business in Northern Ireland,

(c) incorporated and unincorporated bodies to which any provision of this Order applies by virtue of Article 667 (unregistered companies),

(d) limited partnerships registered under the [1907 c. 24] Limited Partnerships Act 1907,

[F996 (da) limited liability partnerships incorporated under the Limited Liability Partnerships Act (Northern Ireland) 2002,]

(e) companies within the meaning of the [1985 c. 6] Companies Act 1985,

(f) companies incorporated outside Great Britain which have complied with section 691 of the Companies Act 1985 (which corresponds with Article 641 of this Order) and which do not appear to the registrar not to have a place of business in Great Britain, and

(g) societies registered under the [1969 c. 24 (N.I.)] Industrial and Provident Societies Act (Northern Ireland) 1969 or the [1965 c. 12] Industrial and Provident Societies Act 1965.

(2) The Department may by order subject to negative resolution vary paragraph (1) by the addition or deletion of any class of body, except any within paragraph (1)(a) or (b) whether incorporated or unincorporated.

F994 mod. by SR 2004/307

F995 SR 1993/198

F996 2002 c. 12 (NI)

Art. 664 rep. by 1990 NI 10

[F997 Interpretation N.I.

664A .F998 — (1) In this Part—

• “document” includes information recorded in any form; and

• “legible”, in the context of documents in legible or non-legible form, means capable of being read with the naked eye.

(2) References in this Part to delivering a document include sending, forwarding, producing or (in the case of a notice) giving it.]

F997 Art. 664A inserted by 1990 NI 10, art. 61

F998 mod. by SR 2004/307

PART XXVF1029 N.I. MISCELLANEOUS AND SUPPLEMENTARY PROVISIONS

Arts. 665‐666 rep. by 2003 NI 17

Unregistered companies N.I.

667.—(1) The provisions of this Order specified in the first column of Schedule 21 (relating respectively to the matters specified in the second column of the Schedule) apply to all bodies corporate incorporated in and having a principal place of business in Northern Ireland, other than those mentioned in paragraph (2), as if they were companies registered under this Order, but subject to any limitations mentioned in relation to those provisions respectively in the third column and to such adaptations and modifications (if any) as may be specified by regulations made by the Department.

(2) The said provisions do not apply by virtue of this Article to any of the following—

(a) any body incorporated by or registered under any statutory provision,

(b) any body not formed for the purpose of carrying on a business which has for its object the acquisition of gain by the body or its individual members,

(c) any body for the time being exempted by direction of the Department.

[F999 (d) any open‐ended investment company within the meaning of the Open‐Ended Investment Companies Regulations (Northern Ireland) 2004.]

(3) Where against any provision of this Order specified in the first column of Schedule 21 there appears in the third column the entry “Subject to Article 667(3)”, it means that the provision is to apply by virtue of this Article so far only as may be specified by regulations made by the Department and to such bodies corporate as may be so specified.

(4) The provisions specified in the first column of the Schedule also apply in like manner in relation to any unincorporated body of persons entitled by virtue of letters patent to any of the privileges conferred by the [1837 c. 73] Chartered Companies Act 1837 and not registered under any other statutory provision, but subject to the like exceptions as are provided for in the case of bodies corporate by paragraph (2)(b) and (c).

(5) This Article does not repeal or revoke in whole or in part any statutory provision, royal charter or other instrument constituting or regulating any body in relation to which the said provisions are applied by virtue of this Article or restrict the power of Her Majesty to grant a charter in lieu of or supplementary to any such charter as aforesaid; but, in relation to any such body, the operation of any such statutory provision, charter or instrument is suspended in so far as it is inconsistent with any of the said provisions as they apply for the time being to that body.

F999 SR 2004/335

Power of company to provide for employees on cessation or transfer of business N.I.

668.—(1) The powers of a company include (if they would not otherwise do so apart from this Article) power to make the following provision for the benefit of persons employed or formerly employed by the company or any of its subsidiaries, that is to say, provision in connection with the cessation or the transfer to any person of the whole or part of the undertaking of the company or that subsidiary.

(2) The power conferred by paragraph (1) is exercisable notwithstanding that its exercise is not in the best interests of the company.

(3) The power which a company may exercise by virtue only of paragraph (1) shall only be exercised by the company if sanctioned—

(a) in a case not falling within sub-paragraph (b) or (c), by an ordinary resolution of the company, or

(b) if so authorised by its memorandum or articles, by a resolution of the directors, or

(c) if its memorandum or articles require the exercise of the power to be sanctioned by a resolution of the company of some other description for which more than a simple majority of the members voting is necessary, with the sanction of a resolution of that description;

and in any case after compliance with any other requirements of its memorandum or articles applicable to its exercise.

(4) Any payment which may be made by a company under this Article may, if made before the commencement of any winding up of the company, be made out of profits of the company which are available for dividend.

Certain companies to publish periodical statement N.I.

669.  F1000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F1000 Art. 669 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Production and inspection of books where offence suspected N.I.

670.—(1) This Article applies if, on an application made in accordance with rules of court to the High Court by the Director of Public Prosecutions for Northern Ireland, the Department or a chief superintendent of the Royal Ulster Constabulary there is shown to be reasonable cause to believe that any person has, while an officer of a company, committed an offence in connection with the management of the company's affairs and that evidence of the commission of the offence is to be found in any books or papers of or under the control of the company.

(2) An order may be made—

(a) authorising any person named in it to inspect the books or papers in question, or any of them, for the purpose of investigating and obtaining evidence of the offence, or

(b )F1001 requiring the secretary of the company or such other officer of it as may be named in the order to produce the books or papers (or any of them) to a person named in the order at a place so named.

(3) Paragraph (2) applies also in relation to any books or papers of a person carrying on the business of banking so far as they relate to the company's affairs, as it applies to any books or papers of or under the control of the company, except that no such order as is referred to in paragraph (2)(b) shall be made by virtue of this paragraph.

(4) The decision of the High Court on an application under this Article is not appealable.

F1001 mod. by SR 2004/307

Form of company registers, etc. N.I.

671 .F1002 —(1) Any register, index, minute book or accounting records required by the Companies Orders to be kept by a company may be kept either by making entries in bound books or by recording the matters in question in any other manner.

(2) Where any such register, index, minute book or accounting record is not kept by making entries in a bound book, but by some other means, adequate precautions shall be taken for guarding against falsification and facilitating its discovery.

(3) If default is made in complying with paragraph (2), the company and every officer of it who is in default is liable to a fine and, for continued contravention, to a daily default fine.

F1002 mod. by SR 2004/307

Use of computers for company records N.I.

672.—(1) The power conferred on a company by Article 671 to keep a register or other record by recording the matters in question otherwise than by making entries in bound books includes power to keep the register or other record by recording those matters otherwise than in a legible form, so long as the recording is capable of being reproduced in a legible form.

(2 )F1003  Any provision of an instrument made by a company before 1st January 1982 which requires a register of holders of the company's debentures to be kept in a legible form is to be read as requiring the register to be kept in a legible or non-legible form.

(3) If any such register or other record of a company as is mentioned in Article 671(1), or a register of holders of a company's debentures, is kept by the company by recording the matters in question otherwise than in a legible form, any duty imposed on the company by this Order to allow inspection of, or to furnish a copy of, the register or other record or any part of it is to be treated as a duty to allow inspection of, or to furnish, a reproduction of the recording or of the relevant part of it in a legible form.

(4) The Department may by regulations make such provision in addition to paragraph (3) as it considers appropriate in connection with such registers or other records as are mentioned in that paragraph and are kept as there mentioned; and the regulations may make modifications of provisions of this Order relating to such registers or other records.

F1003 mod. by SR 2004/307

[F1004 Obligations of company as to inspection of registers, &c. N.I.

672A .F1005 — (1) The Department may make provision by regulations as to the obligations of a company which is required by any provision of this Order—

(a) to make available for inspection any register, index or document, or

(b) to provide copies of any such register, index or document, or part of it;

and a company which fails to comply with the regulations shall be deemed to have refused inspection or, as the case may be, to have failed to provide a copy.

(2) The regulations may make provision as to the time, duration and manner of inspection, including the circumstances in which and extent to which the copying of information is permitted in the course of inspection.

(3) The regulations may define what may be required of the company as regards the nature, extent and manner of extracting or presenting any information for the purposes of inspection or the provision of copies.

(4) Where there is power to charge a fee, the regulations may make provision as to the amount of the fee and the basis of its calculation.

(5) Nothing in any provision of this Order or in the regulations shall be construed as preventing a company from affording more extensive facilities than are required by the regulations or, where a fee may be charged, from charging a lesser fee than that prescribed or no fee at all.]

F1004 Art. 672A inserted1990 NI 10, art. 77

F1005 mod. by SR 2004/307

Service of documents N.I.

673.  A document may be served on a company by leaving it at, or sending it by post to, the company's registered office.

Costs and expenses in actions by certain limited companies N.I.

674 .F1006   Where a limited company is plaintiff in an action or other legal proceeding, the court having jurisdiction in the matter may, if it appears by credible testimony that there is reason to believe that the company will be unable to pay the defendant's costs if successful in his defence, require sufficient security to be given for those costs, and may stay all proceedings until the security is given.

F1006 mod. by SR 2004/307

Power of court to grant relief in certain cases N.I.

675.—(1 )F1007  If in any proceedings for negligence, default, breach of duty or breach of trust against an officer of a company or a person employed by a company as auditor (whether he is or is not an officer of the company) it appears to the court hearing the case that that officer or person is or may be liable in respect of the negligence, default, breach of duty or breach of trust, but that he has acted honestly and reasonably, and that having regard to all the circumstances of the case (including those connected with his appointment) he ought fairly to be excused for the negligence, default, breach of duty or breach of trust, that court may relieve him, either wholly or partly, from his liability on such terms as it thinks fit.

(2 )F1007  If any such officer or person as mentioned in paragraph (1) has reason to apprehend that any claim will or might be made against him in respect of any negligence, default, breach of duty or breach of trust, he may apply to the court for relief; and the court on the application has the same power to relieve him as under this Article it would have had if it had been a court before which proceedings against that person for negligence, default, breach of duty or breach of trust had been brought.

(3) Where the case to which paragraph (1) applies is being tried by a judge with a jury, the judge, after hearing the evidence, may, if he is satisfied that the defendant ought in pursuance of that paragraph to be relieved either in whole or in part from the liability sought to be enforced against him, withdraw the case in whole or in part from the jury and forthwith direct judgement to be entered for the defendant on such terms as to costs or expenses or otherwise as the judge may think proper.

F1007 mod. by SR 2004/307

Enforcement of High Court orders N.I.

676 .F1008   Orders made by the High Court under this Order may be enforced in the same manner as orders made in an action pending in that court.

F1008 mod. by SR 2004/307

Annual report by the Department N.I.

677.  F1009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F1009 Art. 677 repealed (6.4.2007) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16; S.I. 2006/3428, arts. 4(2)(a), 7(c), Sch. 4 Pt. 2 (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5)

Punishment of offences N.I.

678 .F1010 —(1) Schedule 23 has effect with respect to the way in which offences under this Order are punishable on conviction.

(2) In relation to an offence under a provision of this Order specified in the first column of the Schedule (the general nature of the offence being described in the second column), the third column shows whether the offence is punishable on conviction on indictment, or on summary conviction, or either in the one way or the other.

(3) The fourth column of the Schedule shows, in relation to an offence, the maximum punishment by way of fine or imprisonment under this Order which may be imposed on a person convicted of the offence in the way specified in relation to it in the third column (that is to say, on indictment or summarily), a reference to a period of years or months being to a term of imprisonment of that duration.

(4) The fifth column shows (in relation to an offence for which there is an entry in that column) that a person convicted of the offence after continued contravention is liable to a daily default fine; that is to say, he is liable on a second or subsequent summary conviction of the offence to the fine specified in that column for each day on which the contravention is continued (instead of the penalty specified for the offence in the fourth column of the Schedule).

(5) For the purpose of any provision of the Companies Orders which provides that an officer of a company[F1011 or other body] who is in default is liable to a fine or penalty, the expression “officer who is in default” means any officer of the company[F1011 or other body] who knowingly and wilfully authorises or permits the default, refusal or contravention mentioned in that provision.

F1010 mod. by SR 2004/307

F1011 1990 NI 10

Modifications etc. (not altering text)

C13 Art. 678(4) applied (temp.) (15.12.2007) by Companies (Cross-Border Mergers) Regulations 2007 (S.I. 2007/2974), reg. 4, Sch. 1 para. 2

C14 Art. 678(5) applied (temp.) (15.12.2007) by Companies (Cross-Border Mergers) Regulations 2007 (S.I. 2007/2974), reg. 4, Sch. 1 para. 2

Summary proceedings N.I.

679 .F1012 —(1) Summary proceedings for any offence under the Companies Orders may (without prejudice to any jurisdiction exercisable apart from this paragraph) be taken against a body corporate at any place at which the body has a place of business, and against any other person at any place at which he is for the time being.

(2) Notwithstanding anything in Article 19(1)(a) of the [1981 NI 26] Magistrates' Courts (Northern Ireland) Order 1981, a magistrates' court shall have jurisdiction to hear and determine a complaint charging the commission of a summary offence under the Companies Orders provided that the complaint is made within 3 years from the time when the offence was committed and within 12 months from the date on which evidence, sufficient in the opinion of the Director of Public Prosecutions for Northern Ireland or the Department (as the case may be) to justify the proceedings, comes to his or the Department's knowledge.

(3) For the purposes of this Article, a certificate of the Director of Public Prosecutions for Northern Ireland or the Department (as the case may be) as to the date on which such evidence as is referred to in paragraph (2) came to his or its knowledge is conclusive evidence.

F1012 mod. by SR 2004/307

Modifications etc. (not altering text)

C15 Art. 679 applied (temp.) (15.12.2007) by Companies (Cross-Border Mergers) Regulations 2007 (S.I. 2007/2974), reg. 4, Sch. 1 para. 2

Prosecution by public authorities N.I.

680.—(1 )F1013  In respect of an offence under any of Articles 218,[F1014 253E,]F1015 332, 337,F1016 440 to 444 and 448 proceedings shall not be instituted except by or with the consent of the appropriate authority.

(2) That authority is—

(a )F1013 for an offence under any of Articles 218,[F1014 253E,]F1015 332 and 337, the Department or the Director of Public Prosecutions for Northern Ireland,

(b )F1013 for an offence under any of ArticlesF1016 440 to 444, either one of those two persons or the Industrial Assurance Commissioner for Northern Ireland, and

(c )F1013 for an offence under Article 448, the Department.

(3 )F1013  Where proceedings are instituted under the Companies Orders against any person by the Director of Public Prosecutions for Northern Ireland or by or on behalf of the Department, nothing in those Orders is to be taken to require any person to disclose any information which he is entitled to refuse to disclose on grounds of legal professional privilege.

F1013 mod. by SR 2004/307

F1014 2004 c.27

F1015 prosp. insertion. by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

F1016 prosp. subst. by 2005 NI 17

Modifications etc. (not altering text)

C16 Art. 680(3) applied (temp.) (15.12.2007) by Companies (Cross-Border Mergers) Regulations 2007 (S.I. 2007/2974), reg. 4, Sch. 1 para. 2

[F1017 Offences by bodies corporate N.I.

680A.— (1 )F1018  For the purposes of offences under any of Articles 218, 224(3),[F1019 253E(3)F1020 ,] 401B(1)F1021 or 440 to 444, section 20(2) of the Interpretation Act (Northern Ireland) 1954 applies with the omission of the words “the liability of whose members is limited” and where the affairs of a body corporate are managed by its members, applies in relation to the acts and defaults of a member in connection with his functions of management as if he were a director of the body corporate.

(2) In paragraph (1) and in section 20(2) of the Interpretation Act (Northern Ireland) 1954 as it applies by virtue of paragraph (1) “director” includes a shadow director.]

F1017 1990 NI 10, art. 20

F1018 mod. by SR 2004/307

F1019 2004 c.27

F1020 prosp. insertion by 2005 NI 17

F1021 prosp. subst. by 2005 NI 17

[F1022 Criminal proceedings against unincorporated bodies N.I.

680B .F1023 — (1) Proceedings for an offence alleged to have been committed under any of Articles[F1024 253E(3),]F1025 F1026 397A(3), 401B(1) orF1027 440 to 444 by an unincorporated body shall be brought in the name of that body (and not in that of any of its members), and for the purposes of any such proceedings any rules of court relating to the service of documents apply as if that body were a corporation.

(2) A fine imposed on an unincorporated body on its conviction of such an offence shall be paid out of the funds of that body.

(3) Section 18 of the Criminal Justice Act (Northern Ireland) 1945 and Article 166 of and Schedule 4 to the Magistrates' Courts (Northern Ireland) Order 1981 (procedure on charge of offence against a corporation) apply in a case in which an unincorporated body is charged with such an offence as they apply in the case of a corporation.

(4) Where such an offence committed by a partnership is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, a partner, he as well as the partnership is guilty of the offence and liable to be proceeded against and punished accordingly.

(5) Where such an offence committed by an unincorporated body (other than a partnership) is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any officer of the body or any member of its governing body, he as well as the body is guilty of the offence and liable to be proceeded against and punished accordingly.]

F1022 1990 NI 10, art. 20

F1023 mod. by SR 2004/307

F1024 2004 c.27

F1025 prosp. insertion. by 2005 NI 17 (which amendment repealed (6.4.2008) by Companies Act 2006 (c. 46), s. 1295, Sch. 16; S.I. 2007/3495, art. 8(a), Sch. 2 Pt. 2)

F1026 prosp. rep. by 2005 NI 17

F1027 prosp. subst. by 2005 NI 17

Modifications etc. (not altering text)

C17 Art. 680B applied (temp.) (15.12.2007) by Companies (Cross-Border Mergers) Regulations 2007 (S.I. 2007/2974), reg. 4, Sch. 1 para. 2

Regulations N.I.

681 .F1028 —(1) Subject to paragraph (4), the Department may make regulations for prescribing anything which is authorised or required by the Companies Orders to be prescribed.

(2) Regulations under those Orders may contain such consequential, incidental or supplementary provisions as the Department thinks appropriate.

(3) Save as otherwise expressly provided by those Orders, all regulations under them shall be subject to negative resolution.

Para. (4) rep. by 1989 NI 19

F1028 mod. by SR 2004/307